Government funding for the inclusion of 150 low carbon buses in fleets across the UK has been announced.

Transport minister Norman Baker said that the £15 million project, which will see local councils and bus operators bidding for the cash, will help save 50,000 tonnes of carbon emissions.

Currently, less than one percent of buses on the roads are low carbon models, which use up to a third less fuel than conventional buses.

Recipients of the funding will be required to share information on the use of the environmentally-friendly buses with other organisations to improve the store of knowledge about their performance.

"This investment will stimulate the market for low carbon buses by reducing some of the initial costs for operators and councils. It will deliver significant benefits, in particular reducing the impact of road transport on climate change and improving air quality," Mr Baker said.

In December 2009, £30 million from the Green Bus Fund was distributed to 24 bidders for the purchase of around 350 low carbon buses.

The government is also placing its support behind the development of the electric car market, recently announcing a £20 million grant for Nissan to manufacture its Leaf vehicle in the UK.