In a speech on Wednesday, the President said the country was already on track to meet a target of reducing emissions by 18% by 2012, despite a 17% growth in the economy.

He said it was time to look beyond 2012 – and the way to reduce these emissions was not through cap and trade systems or taxes, but by investing in clean technology.

In 2009, almost $1bn is set to be invested in clean coal research and development by government and the private sector, while more than $40bn in loans will be available for other clean air and energy initiatives.

Speaking from the green surroundings of the White House Rose Garden, Mr Bush said there was a right and a wrong way to tackle greenhouse gases.

He said: “The wrong way is to raise taxes, duplicate mandates, or demand sudden and drastic emissions cuts that have no chance of being realised and every chance of hurting our economy.

“The right way is to set realistic goals for reducing emissions consistent with advances in technology, while increasing our energy security and ensuring our economy can continue to prosper and grow.”

He warned Congress against passing laws that would raise energy or fuel prices, and refused to abandon nuclear or coal power.

In a swipe at cap and trade systems, Mr Bush said it was wrong to threaten tariffs on businesses and start a “carbon-based global trade war”.

Mr Bush also said the US was working with other developed nations to develop a successor to the “flawed” Kyoto Protocol.

Reacting to the speech, the Environmental Defense Fund said it was possible to dramatically cut emissions and introduce cap and trade systems without harming the economy.

Fred Krupp, president of the organisation, said: “Waiting until 2025 to stop the growth of greenhouse gas pollution means, for all practical purposes, admitting defeat.

“The president needs to set a much bolder goal if we’re going to succeed. His own Environmental Protection Agency has said that we can do that and grow our economy at the same time.”

Kate Martin

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