This week, West Yorkshire Combined Authority voted to move ahead with plans for 240 electric buses to be rolled out in the coming years.
At a meeting on Thursday members heard that £81m scheme will be partly funded through a Government grant to the region.
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As well as the new buses, the project will fund infrastructure such as charging points at bus depots.
Members were told the changes would help reduce emissions on busy bus routes, including around schools.
Dave Pearson, Director of Transport Services, said the money will be given to bus companies to make up the difference in cost between diesel and electric buses.
Councillor Stewart Golton (Lib Dem, Rothwell) pointed out that £81m was a huge amount to hand out to private bus companies.
He added: “What is it we are adding in value for bus passengers? I don’t see why we should be providing any subsidies for bus companies when they may go on to reduce services.”
West Yorkshire Mayor Tracy Brabin said: “The extra value will be that there are much lower carbon emissions.”