The Department for Business Innovation and Skills (BIS) is calling on automotive companies to provide green engine technologies.

Some £75 million will be given to enable companies to develop low carbon approaches to engine design. BIS states these will form the pilot projects for the Advanced Propulsion Centre, announced in July, which will distribute £1 billion in government backing over the next decade.

Business secretary Vince Cable said: "By 2050, very few - if any - new cars will be powered solely by the traditional internal combustion engines, so it is important that the UK car industry is at the cutting edge of low carbon technologies."

BIS has also awarded £1.5 million for driverless cars to be tested in a city centre. Such a service is already available at Heathrow, but Milton Keynes will be one of the first cities to host such a service, introducing a number of self-driven 'pods' by 2015.

These vehicles will seat two people with luggage, transporting them from the train station to offices and shopping areas no more than a mile away with a top speed of 12 miles per hour.