Nottingham, Bristol, Milton Keynes and London will implement the scheme which will allow electric cars to use bus lanes.
UK Transport Secretary Patrick McLoughlin announced the winners of the Go Ultra Low City Scheme, after the successful cities proposed a number of initiatives to support greener vehicles as part of a government competition.
The winning cities will deliver a rollout of cutting edge technology, such as rapid-charging hubs and street lighting that double as charge points, along with a range of innovative proposals that will give plug-in car owners extra local privileges such as access to bus lanes in city centres. Around 25,000 parking spaces will also be opened up for plug-in car owners saving commuters as much as £1,300 a year.
The funding has been awarded to cities which have designed schemes that will help encourage thousands of people to consider switching to a plug-in car. These proposals will support the UK’s thriving green vehicle sector, improve air quality in urban hotspots and help the government meet its emission cutting targets.
Transport Secretary Patrick McLoughlin said: "These Go Ultra Low Cities have proposed exciting, innovative ideas that will encourage drivers to choose an electric car. I want to see thousands more greener vehicles on our roads and I am proud to back this ambition with £40 million to help the UK become international pioneers of emission cutting technology. The UK is a world leader in the uptake of low emission vehicles and our long-term economic plan is investing £600 million by 2020 to improve air quality, create jobs and achieve our goal of every new car and van in the UK being ultra-low emission by 2040".