The U.S. Department of Transportation announced a $2 billion federal grant program to support bus purchases and depot upgrades for more than 165 public transit agencies, with funding directed mainly toward diesel-hybrid and compressed natural gas (CNG) vehicles rather than battery-electric buses.
The grants are part of the annual allocation under the Infrastructure Investment and Jobs Act passed in 2021. The largest single award, totaling $121.1 million, will go to the Chicago Transit Authority to replace 150 diesel buses with diesel-electric hybrid models. A further $100.7 million was awarded to Harris County, Texas, to support the purchase of CNG buses and related infrastructure.
While around 28 recipients were approved to buy “new buses” without specifying propulsion types, the Transportation Department did not earmark any grants explicitly for battery-electric buses. There is no formal restriction on whether those agencies may opt for electric vehicles, though the guidance does not actively promote them.
The shift contrasts with earlier allocations under the Biden administration, when a significant portion of federal funding was dedicated specifically to low- and zero-emission buses. In 2023, for example, federal grants supported the acquisition of dozens of battery-electric buses and related charging infrastructure, making this year’s funding profile a notable departure.
The announcement also highlights a broader political shift in transportation policy. The current administration is distributing funds from legislation originally designed to accelerate the decarbonisation of public transport, even as the focus pivots toward conventional powertrains. U.S. Transportation Secretary Sean Duffy said the new funding demonstrated a renewed infrastructure push, adding:
“Delivering new-and-improved bus infrastructure is yet another example of how America is building again under President Trump… With these grants, thousands of new buses will hit the road and infrastructure will be upgraded – making public transit more efficient, affordable and safe for American families.”