Infrastructure Minister Nichola Mallon said funding of around £30 million will be invested in the 38 new battery electric vehicles for the city.
It means Derry will be one of the first cities in the UK and Ireland to have a fully zero-emission bus fleet when the vehicles go into passenger service in 2023.
According to the department, the investment will include the buses supplied by local Ballymena firm Wrightbus and a programme of associated infrastructure works.
The new electric buses will include 28 single deck and 10 double deck vehicles.
Stormont ministers, including Ms Mallon, are in Glasgow during the COP26 UN climate summit.
The announcement on Wednesday is in additional to a previous allocation of £74 million for the purchase of zero and low emission vehicles in the Translink fleet across the North of Ireland.
“I have an ambitious vision for a low carbon future and I am committed to delivering cleaner, greener, sustainable infrastructure,” said Ms Mallon.
“I have been clear that tackling the climate crisis is a priority for me and I am committed to building a better future where we make zero/low emission public transport accessible to communities across the North.”
The minister said the new fleet for Derry will “herald a new cleaner and greener era in transport for the city” and promises to make a positive impact on tackling climate change and will improve local air quality.
Translink Group Chief Executive Chris Conway said: “Today marks a further milestone in the journey to achieve our ambitious targets to make public transport carbon net zero by 2040 and go beyond to be climate positive by 2050.
“We have been delighted to make this announcement at COP26 and showcase the actions we are taking to tackle the climate emergency and drive positive change for a healthier and more sustainable transport for future generations to come.”
He added: “We will have over 100 zero emission buses in passenger service next spring making up over a third of our Metro fleet.
“Now this latest order will mean 100% of urban bus services within the city of Derry/Londonderry will be zero-emission not only making bus travel even more attractive and efficient but enhancing local air quality for everyone that lives, works and visits the city.”
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