The government has allocated a £2m funding pot open to both public and private sector van fleet operators looking to switch to hydrogen-fuelled vehicles.

A new Fuel Cell Electric Vehicle (FCEV) Fleet Support Scheme will allow local authorities, health trusts, police forces, fire brigades and private companies to bid for funding to add hydrogen-powered vehicles to their fleets.

The money will cover up to 75% of the costs of new vehicles bought by April 2017, as well as the cost of running them for up to three years. Support will also be available for the leasing or renting of vehicles, insurance, hydrogen fuel and servicing.

Launched by the Office for Low Emission Vehicles (OLEV), the new competition hopes to bring up to 100 more hydrogen fuel vehicles onto UK roads by next spring – tripling the number currently in use.

The new fund comes after the government committed £5m in 2014 through the Hydrogen for Transport Advancement Programme for 12 hydrogen refuelling stations, with the second of these opened this week in London and the remainder by the end of the year.

Transport minister Andrew Jones said: “We are always looking at new ways to make the vehicles of the future cleaner, and hydrogen fuel cells are an important part of our vision for almost all cars and vans to be zero-emission by 2050.”

FCEVs emit no CO2 or other harmful pollutants, and the only by-product is pure water vapour.

The funding competition is split into two streams, one for public sector bids and one for private sector bids. The private sector criteria is open to any size of own-account van operator, however excludes third-party freight transport businesses.

Bids for the FCEV Fleet Support Scheme must be submitted by Monday 4 July.