California Governor Arnold Schwarzenegger praised Britain's prime minister for tackling climate change and said his own state should be credited for U.S. President George W. Bush's change of heart on the issue.

Schwarzenegger, who traveled to London on Blair's last full day in office Tuesday, said that during a decade in power Blair has "proven to the world that you can do both ... protect the Earth and protect the economy."

Last July, Blair traveled to California so that Britain and California could form a trans-Atlantic partnership to address global warming, bypassing the Bush administration to explore ways to curb greenhouse gas emissions and promote clean-burning fuels.

Blair praised Schwarzenegger for last year signing legislation that imposed America's first statewide cap on greenhouse gases. The move put California, which won the support of other states, at odds with the Bush administration, which had resisted global agreements to limit emissions.

Blair said a declaration on climate change agreed by the Group of Eight industrialized nations earlier this month was a major step forward for America.

"For the first time at the G-8 a few weeks ago we have an agreement on the basic principles for a new global deal on climate change," Blair said.

Many people were surprised when Bush was persuaded to join the other G-8 leaders in calling for global emissions reductions and citing a goal of a 50-percent cut by 2050. European leaders at the summit also pushed for mandatory cuts, but Bush resisted.

Blair and Schwarzenegger both said there is an urgent need to replace the Kyoto Treaty, which expires in 2012 and which has been rejected by the U.S.

They said the new international agreement must substantially reduce greenhouse gas emissions and be signed by big emitters such as the United States, China and India.

Blair said California's efforts to fight global warming had helped push Bush in the right decision during the G-8 summit in Germany.

"The fact that the state of California was making such a determined effort and setting out a new direction on climate change — I think this played enormous part," Blair said. "Surely this exposed the president of the country to what its people were saying."

Schwarzenegger said that by experimenting with a greenhouse gas cap, a state like California can show the U.S. federal government that it can succeed without damaging the economy.

"It's not us vs. Washington," Schwarzenegger said. "We can show leadership."

After talking with Blair over breakfast at 10 Downing St., Blair and Schwarzenegger met with 19 business leaders from companies such as BP PLC, DuPont, Goldman Sachs and Google Inc. to discuss ways of accelerating action on climate change and encouraging global momentum toward a low-carbon economy.

The two leaders also took a guided tour of an eco-friendly new school in the Hammersmith district of west London, where excited 10-year-old students chanted "the Terminator" when they saw the governor.

The students showed off the Larmenier elementary school's array of solar panels, grass-insulated roof and large skylights, which reduce the building's need for artificial light.

Blair and Schwarzenegger praised the students for building models of buildings out of recycled materials. The children attached homemade stickers on the lapels of both men that promote walking to school.