The news was announced this morning by the Office for Low Emission Vehicles (OLEV) as part of its £20 million Taxi Scheme.
The funding means work can now start in the city on building the infrastructure to facilitate electric taxis as they become more readily available over the next decade.
An initial 24 charging points will be installed over the next three years, with the aid of match funding from council capital and revenue budgets.
It fits in with wider work to promote low emission vehicles by the West Midlands Combined Authority.
Cabinet Member for City Economy, Councillor John Reynolds, said: "We are working closely with the taxi drivers in the city on this project.
"Electric taxis bring many benefits. They improve air quality and public health, make the city more attractive, support the economy of the Midlands, and support innovation and transformation, as well as help reduce carbon emissions."
Parminder Sekhon, Chair of Wolverhampton Taxi Owners Association, added: "This is great news and these new facilities will help protect the trade as our industry embraces new technologies.
"Whilst drivers would like to purchase low emission vehicles, it needs to be a viable business option, there are costs associated with these vehicles, any support available from central government and the licensing authority will help drivers make the change to newer cleaner vehicles."
The council is aiming to convert 16% of both the Hackney and private hire fleets in the city to electric vehicles by 2020.
The government will provide top up grants of £7,500 to purchasers of the least polluting category of new electric Hackney carriages.
A network of taxi charging points in and around the city centre will be developed over a 3 year period.
- released: Wednesday 22 March, 2017