The UK's first all-electric bus town will be created through a £50 million fund, the Department for Transport (DfT) has announced.
Local authorities are being urged to apply for the grant to help pay for a new fleet of up to 200 electric buses to reduce emissions and boost air quality.
The chosen town will be used as a model by the Government as it attempts to ensure all buses are fully electric by 2025.
The creation of an all-electric bus town is one of a series of measures to improve services and make them greener through a £170 million fund.
Some £70 million will go towards low-fare, high-frequency "Superbus" networks benefiting from more bus lanes and other priority measures.
The first will be introduced in Cornwall next year and will be integrated with the county's main railway line.
Trials of on-demand ride-sharing services in rural and suburban areas will be given a £20 million boost, while local authorities will be given an extra £30 million in 2020 and 2021 to help boost services or restore those that have been lost.
Transport Secretary Grant Shapps said: "Buses carry more people than any other form of public transport in the UK, and with 200 electric buses able to offset 3,700 diesel cars, it is clear they have a crucial role to play in bringing down emissions.
"But Britain's first all-electric bus town is just the start. Helping deliver on our manifesto promise, this £170 million package will help us to create communities which are cleaner, easier to get around and more environmentally friendly, speeding up journeys and making them more reliable.
"By focusing on efficient and affordable transport, we will make greener journeys the natural choice."
Darren Rodwell, the Local Government Association's transport spokesman, said: "This funding is a step in the right direction.
"We would urge the Government to go further in the forthcoming Budget and plug the £700 million annual funding gap councils face in providing the concessionary fares scheme, which would help to protect local routes and reverse the decline in bus services.
"This gap is forcing many councils to increasingly have to divert funding from discretionary routes and services to prop up the statutory scheme."
Darren Shirley, chief executive of the Campaign for Better Transport, said: "Relied upon by millions of people, buses have been sidelined by Government for too long.
"We hope this much-needed funding package will be followed by a long-term funding settlement to set our most-used form of public transport on the road to a brighter future."
