The following page contains the latest information about funding and incentives for zero emission buses and infrastructure in the UK from central government authorities.
Bus funding is devolved in the UK, therefore each regional government has slightly different funding schemes and incentives.
This page was last updated on September 2023.
- England - Capital Grants for Buses & Infrastructure
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To date, the main mechanism for supporting the procurement of zero and ultra low emission bus technologies has been through capital grant awards from the Department for Transport, which reduce the upfront purchase cost of the buses.
Capital grants have been awarded through competition rounds for buses and supporting infrastructure, with historic schemes including:
|
|
Total Number of Buses
|
Total Funding
|
|
Green Bus Fund (2009-2015)
|
1,240
|
£90m
|
|
Low Emission Bus Scheme (2015-2017)
|
484
|
£43m
|
|
Ultra Low Emission Bus Scheme (2017-2020)
|
309
|
£50m
|
|
All Electric Bus Town (2020)
|
300
|
£50m
|
|
ZEBRA Fast Track (2021/22)
|
335
|
£70.9m
|
|
ZEBRA Standard Track (2021/22)
|
819
|
£198m
|
|
Awaiting allocation (2022-25)
|
-
|
£205m
|
As technologies have developed over the last decade, the focus has moved from hybridisation and biofuels towards zero emission technologies such as battery electric and hydrogen fuel cell. The latest funding round has focused exclusively on zero emission buses.
Zero Emission Bus Regional Areas Scheme 1 (2021-2022)
The Zero Emission Bus Regional Areas (ZEBRA 1) scheme is a grant scheme allowing local transport authority areas in England outside London, led by local authorities working in partnership with operators and other stakeholders, to bid for capital grant funding to contribute to the cost of purchasing zero-emission buses and installing infrastructure needed to support their operation.
Only zero-emission single and double deck buses, accredited with Zemo Partnership Zero-Emission Bus (ZEB) certificates, used on local bus services are eligible for funding. Coaches and minibuses are not eligible.
The support available for each area is based on the funding formula used for the Ultra-Low Emission Bus scheme:
DfT will contribute up to 75% of the cost difference between a zero-emission bus and a standard conventional diesel bus equivalent of the same total passenger capacity. For infrastructure, DfT will contribute up to 75% of the capital expenditure incurred as a result of its purchase and installation.
For further information on the scheme, click here.
Local transport authorities will be able to choose from two application processes – the ‘Fast-Track’ process or ‘Standard-Track’ process. The fast-track process allows local transport authorities with developed proposals to be eligible to receive funding under the scheme at an earlier date. The standard-track process allows local transport authorities which require it, additional time to develop their proposals. Both tracks follow the same application process of an initial expression of interest (EoI) followed by full business case development if successful.
A total of up to £120 million was madeUnlink available for the scheme, with up to £70 million allocated to the fast-track scheme, and up to £50 million allocated to the standard-track process.
In November 2021, a total of £70.8 million was allocated to five areas for 335 zero-emission buses and infrastructure through the ‘Fast-Track’ scheme. The successful areas were:
|
Local Authority
|
Funding Award
|
No. of Vehicles Funded
|
Vehicle Type
|
|
Cambridge and Peterborough CA
|
£4.3m
|
30
|
BEV
|
|
Kent County Council
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£9.5m
|
33
|
BEV
|
|
Leicester City Council
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£19.0m
|
96
|
BEV
|
|
Milton Keynes Council
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£16.0m
|
56
|
BEV
|
|
Warrington Borough Council
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£21.5m
|
120
|
BEV
|
A further £150m was allocated to the ZEBRA scheme in November 2021, with a total £199.2m of funding for the Standard Track.
In March 2022, a total of £198 million was allocated to twelve areas for 943 zero-emission buses and infrastructure through the Standard Track process. The successful areas were:
|
Local Authority
|
Funding Award
|
No. of Vehicles Funded
|
Vehicle Type
|
|
Greater Manchester CA
|
£36.9m
|
170
|
BEV
|
|
Norfolk County Council
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£3.3m
|
15
|
BEV
|
|
Oxfordshire County Council
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£32.8m
|
159
|
BEV
|
|
West Midlands CA
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£30.0m
|
124
|
HFC
|
|
Blackpool Council
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£19.6m
|
115
|
BEV
|
|
West Yorkshire CA
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£23.1m
|
111
|
BEV
|
|
Nottingham City Council
|
£15.2m
|
78
|
BEV
|
|
York City Council
|
£8.5m
|
44
|
BEV
|
|
North Yorkshire County Council
|
£7.8m
|
39
|
BEV
|
|
Portsmouth City Council
|
£6.4m
|
34
|
BEV
|
|
South Yorkshire Mayoral CA
|
£8.4m
|
27
|
BEV
|
|
Hertfordshire County Council
|
£6.6m
|
27
|
BEV
|
The scheme to date has allocated £268.8 million of funding to 17 areas for 1,278 zero-emission buses and infrastructure. This included 1,154 battery electric buses and 124 hydrogen fuel-cell buses.
In March 2023, it was announced that four local transport authorities had been awarded a share of £25.3 million of funding to support the introduction of additional zero emission buses for their ZEBRA projects. These included City of York Council (£1.9m), Portsmouth City Council and Hampshire County Council (£6.2m), Norfolk County Council (£11.5m) and West Yorkshire Combined Authority (£5.7m).
The ZEBRA 1 Scheme is no longer accepting applications.
Zero Emission Bus Regional Areas Scheme 2 (2023-2025)
In September 2023, the DfT launched ZEBRA 2 supported by up to £129m in grant funding. The single stage grant funding competition allows local transport authority areas in England outside London, led by local authorities working in partnership with operators and other stakeholders, to bid for capital grant funding to contribute to the cost of purchasing zero-emission buses and installing infrastructure needed to support their operation.
Zero emission single and double deck buses, accredited with Zemo Partnership Zero Emission Bus (ZEB) certificates, used on local bus services are eligible for funding. Zero emission minibuses used on local bus services and accredited with a Zemo ZEB certificate are eligible for funding too. Coaches and buses repowered to zero emission are not eligible.
The support available for each area is based on the funding formula used for phase of the ZEBRA scheme:
DfT will contribute up to 75% of the cost difference between a zero-emission bus and a standard conventional diesel bus equivalent of the same total passenger capacity. For infrastructure, DfT will contribute up to 75% of the capital expenditure incurred as a result of its purchase and installation.
£25 million will be initially reserved for proposals to introduce ZEBs in rural areas.
For further information on the scheme, click here.
- England - Bus Service Operators Grant (BSOG)
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The Bus Service Operators Grant (BSOG) is a support mechanism for bus operators in England designed to keep bus fares affordable. Operators make claims annually to the Department for Transport based on the amount of fuel consumed and distance travelled.
Historically BSOG has focused on supporting diesel buses through a reimbursement of £0.3456 / litre of diesel consumed. As we now shift to a net-zero transport system, a new incentive has been introduced to support operators afford the higher capital cost of zero emission buses and battery replacement.
New Zero Emission Bus BSOG incentive
The Bus Service Operator Grant (BSOG) Zero Emission Bus (ZEB) incentive, due to be introduced on 1st April 2022, is a temporary uplift designed to further encourage operators to run zero-emission vehicles, eclipsing the financial support provided by the BSOG LCEB incentive.
Operators that run public routes are entitled to claim money from the DfT based on the amount of fuel used over miles operated. Zero-emission buses use no fuel and therefore operators are entitled to claim no financial support under BSOG (Fuel Duty rebate). While, zero-emissions buses qualifying as a LCEB, LEB or ULEB can claim the BSOG LCEB incentive as outlined above, the BSOG ZEB uplift is being introduced to further incentivise the operation of zero-emission vehicles in the place of conventional diesel vehicles.
If a vehicle qualifies as a ZEB (through holding a Zemo Partnership ZEB certificate), and runs on a publicly accessible route, it is entitled to receive £0.22/km operated. Unlike the LCEB incentive, there is no longer a requirement for 22 passengers for a vehicle to be eligible, normal BSOG vehicle eligibility rules apply (M2 or M3 vehicle). Operators claiming under the BSOG ZEB scheme cannot also claim the BSOG LCEB incentive in conjunction. The incentive is paid retrospectively.
Claiming BSOG ZEB incentive for Minibuses
Claims from 1st April 2023 - Operators running services under a Section 19 or Section 22 license are entitled to claim the Zero Emission Bus incentive (22p/km) without requiring a Zero Emission Bus Certificate/Summary Sheet, for services operated using vehicles with a gross vehicle weight (GVW) of no more than 3.5 tonnes.
Operators wishing to claim under this exemption must supply a copy of the vehicle log book (V5C) that demonstrates the vehicle has zero tailpipe emissions, and self-certify that the vehicle has no other internal combustion engine on board. This can be done by email that accompanies the claim.
Vehicles with a GVW of 3.5 tonnes and above will be required to get a Zero Emission Bus certificate in order to claim the Zero Emission Bus incentive (22p/km).
BSOG Plus
From July 2023, funding for BSOG+ will be applied to ZEBs in the same way as other fuel types and calculated based on 40% of the existing BSOG ZEB incentive, along with a 5.5p per KM distance-based payment calculation. For ZEB rates this will mean a total BSOG+ payment of 14.3p per km, made up of 8.8p per km specifically for Zero Emission Buses plus 5.5p per km for all eligible services, which will need to be claimed separately to BSOG. This means ZEBs in England which meet normal BSOG eligibility criteria can claim up to 36.3p per km.
BSOG LCEB incentive
The Bus Service Operator Grant (BSOG) Low Carbon Emission Bus (LCEB) incentive is designed to ensure that operators running more fuel-efficient vehicles would be entitled to similar financial support as operators running conventional diesel vehicles.
Operators that run public routes are entitled to claim money from the DfT based on the amount of fuel used over miles operated. Fuel efficient, lower carbon buses use less fuel and therefore operators are entitled to claim less financial support, therefore the BSOG LCEB incentive was created to balance the reduction in payback and incentivise operators to operate LCEBs.
If a vehicle qualifies as an LCEB, LEB or ULEB and runs on a publicly accessible route, it is entitled to receive £0.06/km operated.
View more information on the Bus Service Operators Grant (BSOG).
- Scotland
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|
Scotland
|
Number of Buses
|
Total Funding
|
|
Scottish Green Bus Fund 1-4
|
1
|
£96,288.00
|
|
Scottish Green Bus Fund 5-8
|
10
|
£1,152,431.00
|
|
SULEBS 1.0
|
57
|
£10,139,412.00
|
|
SULEBS 2.0
|
215
|
£40,543,348.00
|
|
ScotZEB Challenge Fund
|
276
|
£62,000,000.00
|
Scotland Zero Emission Bus (ScotZEB) Challenge Fund Phase 1 (2021-2022)
The Scottish Zero Emission (ScotZEB) Challenge Fund Phase 1 was a grant scheme allowing local transport authorities and operators in Scotland to bid for capital grant funding to contribute to the cost of purchasing zero-emission vehicles and installing infrastructure needed to support their operation. The scheme encourages partnership bids between multiple parties and the development of innovative funding models to reduce the need for grant funding.
Zero-emission single and double deck buses, coaches and minibuses accredited with Zemo Partnership Ultra-Low / Zero Emission Bus certificates, used on local bus services are eligible for funding.
The support available is detailed below:
|
Seating
|
ZE range
|
Technology
|
Vehicle Type
|
Funding available
|
|
At least 9 Seats
|
n/a
|
Any ZEB certified vehicle
|
Minibus
|
Up to £80k
|
|
At least 32 Total Passenger Capacity
|
n/a
|
Any ZEB certified vehicle
|
Midibus
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Up to £140k
|
|
At least 60 Total Passenger Capacity
|
n/a
|
Electric
|
Full size bus
|
Up to £180k
|
|
At least 60 or more Total Passengers
|
n/a
|
Hydrogen
|
Full size bus
|
Up to £230k
|
|
At least 45 Seats or more
|
310km
|
Electric
|
Coach
|
Up to £180k
|
|
At least 45 Seats or more Total Passengers
|
310km
|
Hydrogen
|
Coach
|
Up to £230k
|
For electric infrastructure, Transport Scotland will contribute up to 75% of the capital expenditure incurred because of its purchase and installation. For hydrogen infrastructure, Transport Scotland will contribute up to 85% of the capital expenditure incurred because of its purchase and installation.
For further information on the scheme, click here.
Phase 1 of the scheme was allocated £50 million of funding. In February 2022, Transport Scotland announced the award of over £62m towards the purchase of 276 battery-electric buses and their associated infrastructure. The successful bidding organisations were:
|
Operator
|
Funding Award
|
No. of Vehicles Funded
|
Vehicle Type
|
|
Bluebird Buses Ltd
|
£3.1m
|
13
|
BEV
|
|
Craig of Cambeltown Ltd
|
£2.4m
|
10
|
BEV
|
|
Dumfries and Galloway Council
|
£0.6m
|
4
|
BEV
|
|
Ember Core Ltd
|
£5.5m
|
26
|
BEV
|
|
Fife Scottish Omnibuses
|
£7.3m
|
32
|
BEV
|
|
First Glasgow
|
£18.6m
|
50
|
BEV
|
|
First Aberdeen
|
24
|
BEV
|
|
Highland Country Buses Ltd
|
£5.8m
|
25
|
BEV
|
|
Houston Coaches
|
£0.4m
|
4
|
BEV
|
|
McGills Bus Service Ltd
|
£9.1m
|
41
|
BEV
|
|
Shuttle Buses Ltd
|
£0.5m
|
5
|
BEV
|
|
Stirling Council
|
£0.6m
|
3
|
BEV
|
|
Western Buses Ltd
|
£8.0m
|
39
|
BEV
|
The ScotZEB Phase 1 Fund is no longer accepting applications.
Scotland Zero Emission Bus (ScotZEB) Challenge Fund Phase 2 (2023)
The Scottish Zero Emission (ScotZEB) Challenge Fund Phase 2 is a grant scheme allowing a range of consortia including local transport authorities, bus and coach operators, finance providers, vehicle suppliers and infrastructure providers in Scotland to bid for capital grant funding to contribute to the cost of purchasing zero-emission vehicles and installing infrastructure needed to support their operation. The scheme encourages partnership bids between multiple parties and the development of innovative funding models to reduce the need for grant funding.
Only consortium bids will be considered, and need to include at least one financier and at least two SME bus or coach operators and/or two community transport operators.
Zero-emission single and double deck buses (including repowered vehicles), coaches and minibuses are eligible for funding. The criteria for use on local bus services only no longer applies.
The support available is detailed below:
|
Seating
|
Vehicle Technology |
Vehicle Type
|
Funding available
|
|
At least 9 Seats and at least 1 Wheelchair
|
Electric or Hydrogen |
Bus or Coach
|
Up to £60k
|
|
32 or more Total Passenger Capacity
|
Electric or Hydrogen |
Bus or Coach
|
Up to £105k
|
|
At least 45 Seats
|
Electric or Hydrogen |
Bus or Coach
|
Up to £135k
|
|
60 or more Total Passenger Capacity
|
Electric or Hydrogen |
Bus or Coach
|
Up to £135k
|
|
N/A
|
Electric Repower |
Bus
|
Up to £50k
|
For electric and hydrogen infrastructure, Transport Scotland will contribute up to 70% of the capital expenditure incurred because of its purchase and installation.
The ScotZEB Phase 2 Fund is no longer accepting applications.
For further information on the scheme, click here.
- Wales
-
Welsh Government allocates capital grant funding an ad hoc basis to local authorities for ZEB procurement.
There are currently no direct operational incentives for zero emission buses in Wales.
- Northern Ireland
-
NI Department for Infrastructure awards capital grant funding on an ad hoc basis to Translink, who operate the bus fleet in NI.
There are currently no direct operational incentives for zero emission buses in Northern Ireland.