Prime Minister Kevin Rudd has praised commitments by Japan and China to lower their carbon emissions - steps that should boost progress toward a global treaty in Copenhagen in December.
Speaking at the United Nations Climate Summit held overnight in New York, Mr Rudd said the world needed a "grand bargain" and after chairing one of four round tables, he was more convinced that there was "clear support to conclude this deal".
New Japanese Prime Minister Yukio Hatoyama used the climate gathering at the United Nations to unveil plans for a new emissions trading scheme that would cut its carbon output 25 per cent as its mid-term goal.
China President Hu Jintao, the first Chinese president to attend the UN for 40 years, said his country planned to further improve China's carbon intensity per unit of GDP by a "notable amount".
Although he was light on hard numbers, President Hu committed the world's most populous nation to a new round of measures post 2010, when its current energy targets are due to expire.
These also included boosting the reliance on nuclear power, reducing its share of use of fossil fuels, and increasing forest coverage by 40 million hectares from 2005 levels.
China's preparedness to offer more commitments – if a little vague - is seen as a major step forward.
Mr Rudd said it was a "positive statement" by China and showed China was seriously negotiating.
The US negotiators were more sceptical, however, saying that the announcement lacked detail and that it was unclear how much further China was preparing to go beyond its current efficiency goals which are already in place.
Mr Rudd noted that the French have raised the stakes by threatening that European nations would be prepared to consider a carbon tax on imports of goods from countries which fail to take meaningful action on climate change.
In a passionate speech French President Nicholas Sarkozy warned that if the world did not act, it faced "total disaster".
He called on the world's wealthy nations to contribute to the financing of poorer nations who need to make a transition to a low carbon economy and said Europe stands ready to contribute toward the $100 billion a year needed.
In his first speech to the United Nations since becoming US President, Barack Obama said the US recognised that despite making sweeping changes to encourage renewable energy and energy efficiency in the last eight months, there was "so much more work to be done".
"We understand the gravity of the climate threat," he said. "We are determined to act. And we will meet our responsibility to future generations."
Mr Obama pointed to the progress of a carbon trading scheme through the US House Congress but did not directly address the problems he faced in passing the bill through the full Senate.
But as expected, he made it clear that his difficulties in his own capital will be assisted if the developing countries pull their weight.
"Difficulty is no excuse for complacency. Unease is no excuse for inaction. And we must not allow the perfect to become the enemy of progress," Mr Obama said.
"Yes, the developed nations that caused much of the damage to our climate over the last century still have a responsibility to lead. But those rapidly-growing developing nations that will produce nearly all the growth in global carbon emissions in the decades ahead must do their part as well.
"We cannot meet this challenge unless all the largest emitters of greenhouse gas pollution act together. There is no other way."
India has also moved significantly, with the environment minister, Jairam Ramesh, telling a press conference at the New York Library on Monday that his government planned to make "aggressive" cuts in emissions.
"I can assure you our per capita emissions will always remain well below those of the developed world," he said, referring to the thorny issue of who is to blame historically for the dangerous build-up of carbon dioxide in the atmosphere.
However, Mr Ramesh acknowledged that India's large population meant increases in India's energy, even if it was from a low base had a "big multiplier effect" and that India planned to take some major mitigation measures voluntarily.
These include a mandatory fuel efficiency target which would come into effect in 2011; an energy efficient building code which would come into effect in 2012; and an increase in electricity produced from renewable sources to 20 per cent by 2020.
The measures by China and India - if fully realised - could represent a breakthrough in bringing the two into a global deal on climate at December's UN summit in Copenhagen. Almost all observers say those talks are dangerously stalled.
UN Secretary General, Ban Ki Moon. urged the world's leaders to lead.
"The lives of billions of people literally rests on your shoulders," he said.