California Gov. Arnold Schwarzenegger on Wednesday signed into law a sweeping global warming initiative that imposes United States' first cap on greenhouse gas emissions, taking the lead on an issue largely ignored by the Bush administration.

Standing on picturesque Treasure Island with San Francisco's skyline in the background, the Republican governor called the fight against global warming one of the most important issues of modern times.

"We simply must do everything we can in our power to slow down global warming before it is too late," Schwarzenegger said during an address before signing the bill.

• Click here to visit FOXNews.com's Natural Science Center.

British Prime Minister Tony Blair, who struck a deal with Schwarzenegger over the summer to develop clean technologies, joined the ceremony via video link.

San Francisco Mayor Gavin Newsom and New York Gov. George Pataki, as well as Democratic legislators, joined Schwarzenegger for the high-profile ceremony.

Blair called the bill-signing "a proud day for political leadership" and "a historic day for the rest of the world, as well."

California's efforts on global warming have been in the spotlight since Schwarzenegger and the state's legislative Democrats reached an accord last month on the Democrat-authored bill to cut greenhouse gases.

The negotiations culminated in the last week of the legislative session, handing the Republican governor a key victory during an election year in which he has sought to portray himself as a friend to the environment.

On Wednesday, Schwarzenegger called the bill signing a historic occasion.

"It will begin a bold new era of environmental protection in California that will change the course of history," he said.

He expected other states, the federal government and even other nations to follow.

"I'm convinced of that ... because nothing is more important than protecting our planet," he said.