LONDON (Bloomberg) - China and the US, the biggest sources of the greenhouse gas emissions heating the planet, have stood in the way of an international climate treaty for almost as long as there have been efforts to craft one. The US never ratified the 1997 Kyoto Protocol partly because the pact did not compel China and other developing economies to lower emissions.

Now, the two countries may be moving toward agreement on how to rein in the 40 percent of the world's carbon dioxide pollution that comes from their cars, factories and power plants.

Chinese and US officials on July 28 pledged to cooperate on clean-energy technology. US Secretary of State Hillary Clinton lauded the memorandum of understanding for giving direction to ongoing negotiations between the two countries ahead of a meeting of 192 nations in December in Copenhagen that's supposed to produce a successor to the Kyoto pact.

"There is a good chance at the end of the day that we're going to be able to find an accommodation with China," says Todd Stern, the State Department's special envoy for climate change. Bilateral discussions are making progress, Mr. Stern says, while cautioning that there have been no "breakthroughs".

Yvo de Boer, executive secretary of the United Nations Framework Convention on Climate Change, says agreement between China and the US is make or break for the Copenhagen talks, which his organisation is running. "If these two countries don't co-operate further, then we're not going to get a result," de Boer says. "They need to find a way forward together, and I think that they can."

Developing nations such as China and India will not support a treaty that caps their greenhouse gas emissions, arguing that such limits might hobble the economic growth needed to lift more of their citizens out of poverty.

Instead, they will probably agree to steps such as improving automobile fuel economy, raising the efficiency of power plants and installing wind turbines, says Elliot Diringer, who oversees international strategies at the Pew Center on Global Climate Change in Arlington, Virginia.

China is prepared to take such actions to get a deal, says Jonathan Pershing, Mr. Stern's lead negotiator.

Su Wei, China's lead climate treaty negotiator, says talks with the US have affirmed the principle of "differentiated responsibilities", a term that climate negotiators have adopted for the idea that commitments will vary from country to country based on economic development. "We're going to increase our dialogue and try to be as positive as possible towards a successful outcome in Copenhagen," Su says.