The Scottish Government confirmed a new investment package of up to £40 million through ScotZEB2, reopening the second and last phase of the funding programme. The grant is expected to support the purchase of up to 300 battery-electric or hydrogen fuel cell buses by operators across the country.
“The second and final phase of the Scottish Zero Emission Bus Challenge Fund (ScotZEB 2) has received further funding to expand the number of projects supported under the initiative,” Transport Scotland states on its website, effectively reopening the final round of the Scottish Zero Emission Bus Challenge Fund (ScotZEB2) funding. The scheme is aimed at supporting large operators in replacing diesel fleets with zero-emission models.
In July last year, the government awarded a Zenobē-led consortium of eight bus operators 41.7 million pounds in funding. That was supposed to be the last grant made available. However, Transport for Scotland now states that “to continue to maximise the benefits of the ScotZEB programme, the second-placed bid will be reviewed by officials, and if successful against scheme criteria, will be considered for further funding.
The second-placed was Rock Road, a UK-based funding platform for “both battery and hydrogen-powered bus”, set up in 2024. The now-announced grant could put as many as 300 new zero-emission busses on the road in Scotland.
Phase 2 of the Scottish Zero Emission Bus Challenge Fund (ScotZEB2) offers capital funding to speed up the transition to battery-electric and hydrogen buses, coaches and associated charging or refuelling infrastructure. Launched in May 2023, it supports consortium bids involving operators, financiers, manufacturers, infrastructure providers and local authorities. The goal is to make zero-emission vehicles the standard for all bus and coach operations, including school, community, health transport and tourism services.
Building on Phase 1, which awarded £62 million for 276 vehicles and infrastructure, ScotZEB2 is the final round of the scheme and is designed to leverage private investment, encourage collaboration, and prepare the sector for potential regulation banning new non-zero-emission buses from 2030. It has supported multiple bus operators, such as Stagecoach, with the electrification of their fleets and infrastructure.
In parallel with the new funding, the government is assessing potential regulatory measures to be introduced no earlier than 2030 to underpin a phased transition to zero-emission buses. Officials say this will form part of wider efforts to decarbonise heavy-duty vehicles and encourage modal shift to public transport.
“This further investment of up to £40 million from the Scottish Government through ScotZEB2 is a clear signal of our commitment to a zero-emission future for Scotland’s transport network. Since 2020, we have invested over £154 million in zero-emission buses and infrastructure, and this new funding is aimed at helping more operators to make the switch,” said Cabinet Secretary for Transport Fiona Hyslop.
She continued to explain that “with every £1 of public funding leveraging over £3 of private investment, ScotZEB2 has exemplified how government and industry can work together to deliver sustainable, inclusive transport solutions. The programme is not only reducing emissions – it’s supporting jobs, connecting communities, improving air quality, and continuing to build a cleaner, greener Scotland.”
transport.gov.scot (announcement), transport.gov.scot (ScotZEB2 update)
