Bus Éireann has been announced as the preferred bidder for five bus routes in Waterford city.
It followed a competitive process involving five bids from Irish and international firms.
The National Transport Authority (NTA) says it will be formally sending a detailed Letter of Intent to Bus Éireann in the coming weeks.
Anne Graham, chief executive officer of the NTA, said: "This is ultimately about improving bus services for people in Waterford city, and making public transport a more attractive option for members of the travelling public in the city.
"A significant benefit is the new fleet of 17 vehicles that we are purchasing for these services.
"The buses are powered by the latest Euro VI diesel engine, which are much cleaner in use than older diesel engines."
The new vehicles will be certified as ‘low emission’, meaning they generate about 30% less carbon emission than standard diesel buses.
The new buses will be on the streets of Waterford in 2018.
All the buses will also have a wheelchair space and a buggy space, plus a motorised ramp at the entrance door to allow wheelchairs to board easily.
USB chargers will be installed at every seat, and Wi-Fi will be available throughout.
It comes after English firm Go-Ahead was selected as preferred bidder for 10% of Dublin Bus routes back in August.
The company is expected to begin operating in Dublin by the end of next year, and will operate all routes by February 2019.
A similar process is also underway on the Kildare-Dublin commuter route.