A new Clean Air Fund will give financial support to local authorities attempting to address air pollution in their areas.
The £220m fund, announced by Philip Hammond in the Autumn Budget, will be paid for by higher Vehicle Excise Duty (VED) on diesel cars bought after 1 April 2018.
Hammond emphasised that that the VED rise would not apply to or affect van drivers.
A consultation into what the fund could support has been launched in conjunction with Hammond's Budget statement.
He said: "The tax system can play an important role in protecting our environment.
"We owe it to our children that the air they breathe is clean."
The Autumn Budget also announced a new study on the future of freight infrastructure in the UK, to be published in Spring 2019.
The NIC's study will look at urban congestion and decarbonisation, as well as how freight can harness new technologies such as platooning.
A Transforming Cities fund for the Northern Powerhouse also played a part in Hammond's Budget, which will focus on improving transport in UK cities
The £1.7bn from the Northern Powerhouse Investment Fund will target productivity-driving projects that improve connectivity and reducing congestion in the cities.
Half of the money will be distributed among the combined authorities with metro mayors, which were elected earlier this year.
The West Midlands will receive the largest chunk of this with £250m. Greater Manchester will get £243m; £134m will go to Liverpool; £80m for the West of England; £74m for Cambridgeshire and Peterborough and £59m for Tees Valley.
The other half of the Transforming Cities fund will be distributed through competition for project funding.