Selinger unveiled a prototype of the made-in-Manitoba bus with officials from Mitsubishi Heavy Industries, New Flyer, Manitoba Hydro and Red River College.
The $3-million cost is being split equally between the government, Manitoba Hydro and Mitsubishi.
The bus is equipped with electric drive and carries advanced lithium-ion batteries that can be charged from the electrical grid.
Testing over the next two years is to start with operational dry runs before the bus is moved to select routes in Winnipeg.
The project is part of a deal on renewable energy signed by Manitoba and Mitsubishi Heavy Industries in 2010.