Improved passenger transport services around Feilding and to and from Palmerston North will be provided by an all-electric bus fleet.
Horizons Regional Council has awarded the contract for the Orbiter and commuter services to Tranzit, with the new routes coming into action in July next year.
Council chairwoman Rachel Keedwell said using electric vehicles would save 120,000 litres of diesel a year.
She hoped the improved frequency of the new services would also encourage more people to take a bus rather than use private motor vehicles.