Listed company Infratil plans to go part-electric for its bus services as part of a $43 million deal with a US company.
The deal, announced today, will make it possible to re-power Wellington's trolley buses.
Infratil owns NZ Bus, which runs over 1000 vehicles in Auckland and greater Wellington.
It has now signed a deal with Californian company Wrightspeed to supply part-electric vehicles.
Wrightspeed was founded by New Zealander Ian Wright, who was a co-founder of Tesla.
The move follows Wellington's controversial decision to end its trolley bus service.
But these will now be able to be re-powered, and the move has been applauded by both the government and the Green Party.
The deal extends Wrightspeed's electric powertrain technology from service vehicles like rubbish collectors to mass transit.
The vehicles operate with a small motor that uses any fuel such as diesel, CNG, LNG or others.
This charges batteries which propel the vehicle, but only operates when it is needed, avoiding unnecessary noise and pollution while idling.
After re-powering the trolley buses, the technology will be retrofitted to other selected vehicles.
NZ Bus will receive its first Wrightspeed powertrains by mid-2016, and the service will start early next year.