This story was last updated at 2 p.m. ET.

The U.S. and China — the world's top emitters of planet-warming greenhouse gases — deepened their cooperation on global warming on Friday with the release of the second joint presidential statement on climate change between Chinese President Xi Jinping and President Obama in just 10 months.

The most significant component of the new agreement is China's creation of a national carbon trading system to reduce its soaring greenhouse gas emissions, to be put in place in 2017. The system would be the largest such program in the world, dwarfing ones currently in place in California, Europe and parts of Canada.

The program was announced at the White House during a midday press conference between the two leaders, who have found common cause on climate change while encountering tension on a host of other issues.

In addition to the cap and trade system, China is also pledging the equivalent of $3.1 billion to help developing countries combat climate change through lower emissions growth strategies and cope with its impacts. The country also will implement policies to favor clean power sources over fossil fuels both domestically and through its investments abroad.

These actions, as well as others from the U.S., improve the odds for a meaningful climate treaty to be forged in Paris, President Obama said.

"When the world’s two largest economies, energy consumers and carbon emitters come together like this, then there’s no reason for other countries — whether developed or developing — to not do so as well," President Obama said.

President Xi said the U.S. and China have agreed “to work together to push the Paris climate change conference to produce important progress.”

World's largest carbon market

Under such systems, which are also called emissions trading systems, an overall limit or "cap" on emissions is set, and companies buy and sell emissions credits in addition to cutting emissions in an effort to find the most economically advantageous way of lowering pollution.

The system will encompass some of the largest economic sectors in China, including the country's power generation, iron and steel, chemicals and building materials sectors, including cement, paper-making and nonferrous metals.

"These sectors together produce a substantial percentage of China’s climate pollution, and this reflects a significant policy move that the Chinese are announcing they will take," said a senior U.S. official who worked on the agreement, who briefed reporters on Thursday night.

See also: Republican candidates never got the memo that China is acting on climate change

The new program is considered vital to securing an ambitious global warming agreement in Paris in December, since China is the top greenhouse gas emitter on the planet, and the U.S. is in the No. 2 spot.

The announcement deflates a recent Republican talking point, with several presidential candidates arguing that the U.S. should not take steps to reduce its emissions because China is not taking costly actions of its own.

The measures come less than a year after China and the U.S. came together to break the logjam of climate negotiations that was holding back progress for decades.

Last year, China and the U.S. announced joint commitments to tackle global warming, with the U.S. agreeing to reduce its emissions by 26 to 28% below 2005 levels by 2025, and China agreeing to peak its emissions by 2030 at the latest.

The U.S. goal committed the U.S. to a much faster pace of emissions cuts than previously announced, and, if fulfilled, would keep the country on course to cut emissions by 80% relative to 2005 levels by 2050.

Global carbon emissions trajectory with and without the most recent Chinese commitment to peak emissions by 2030 at the latest. Image: C-ROADS

China also announced a goal to increase the share of renewable energy it uses to about 20% by 2030.

Since then, several Chinese cities, representing about 25% of the country's urban emissions, have agreed to peak dates in the mid-2020s, indicating a push toward more ambitious action.

White House officials said that while last year's announcements were focused on shared goal-setting, Friday's are focused on implementing those goals.

"This year is about showing the world our countries’ conviction to implement policies to reach those targets and to lead the world toward a durable global climate agreement," said a senior White House official who briefed reporters on a conference call, but did not wish to be identified because they were not authorized to discuss details of the agreement in advance.

The carbon trading system is an approach that was pioneered by the U.S. for curbing acid rain, but Congress failed to pass such a program to rein in the main global warming pollutant — carbon dioxide — during Obama's first term, forcing the White House to use EPA-mandated emissions cuts to accomplish the task instead.

Environmental leaders praised the announcement.

“China has repeatedly shown that it’s serious about moving to a low-carbon economy. A national carbon trading program in China should send a strong signal to businesses and investors of the growing promise of low-carbon energy," said Andrew Steer, president and CEO of the World Resources Institute, which has offices in the U.S. and China, in a statement.

More clarity heading into Paris negotiations

The two leaders also agreed to a "common vision" for the climate agreement to be forged in Paris in December, which would go into force in 2020. So far, emissions reduction pledges made ahead of the summit are not sufficient to contain global warming below dangerous levels.

The wording of the joint statement addresses this issue by calling for "a successful agreement that ramps-up ambition over time, pointing toward a low-carbon transformation of the global economy this century."

The two leaders call for ramp-up steps that would make post-Paris agreements more ambitious, potentially ensuring the international temperature goal is reached.

In another sign of progress toward a Paris climate agreement, the two leaders are calling for countries to make available by mid-century their strategies to transition to low carbon economies, putting pressure on other nations to act more boldly.

Lou Leonard, the head of the climate change program at the World Wildlife Fund, said the new announcements open up more opportunities for climate announcements prior to Paris.

“This is good news as climate negotiators look for ways to close the emissions gap separating us from a safer future," he said in a statement.

So long, Republican talking point...

The joint-U.S. and China climate announcement on Friday, as well as last year's steps, renders moot the point several Republican presidential candidates made at the most recent debate about how the U.S. shouldn't act on global warming because China won't do anything about it.

During the debate on Sept. 17, Florida Senator Marco Rubio cited China's emissions as the main reason America should not act.

"America is not a planet," Rubio said, noting that China is exploiting fossil fuels around the world to fuel their development. "And we are not even the largest carbon producer anymore, China is. And they're drilling a hole and digging anywhere in the world that they can get ahold of."

The cap and trade system arguably would go further than the U.S. has been willing to go toward using market-based mechanisms to curb emissions. The EPA's regulations would create a smaller-scale emissions trading system that states could tap for reducing their emissions, but it would be on a far smaller scale than China's program.

Ironically, it's largely been Republicans, along with some coal-state Democrats, standing in the way of such measures, despite the party's traditional enthusiasm for market-based policy solutions.