Tokelau, a Pacific micro-state with only 1,500 people and three cars, today challenged world leaders at the UN climate talks in Durban to follow its lead and switch entirely to renewable energy.

The pinprick of low-lying land halfway between new Zealand and Hawaii, is two days' boat ride – and no aeroplane – from anywhere. But, cyclones permitting, next September it will switch off its old diesel generators and be powered by a $7.5m solar PV system designed to provide 90% of its energy. The rest will come from home-made coconut oil.

"If all goes to plan, the three islands of Tokelau will formally lead the world in percentage reduction in the use of fossil fuels, will be number one leader in carbon emissions savings per person, and number one renewable energy country," said Foua Toloa, the ulu, or head, of the New Zealand protectorate.

"We stand to lose the most of any country in the world due to climate change and the rising sea levels, so leading the way by making the highest per person investment in the wold is a message to the world to do something," he said "It took me 64 hours to get here. Before I left my eldest daughter said: 'Go challenge the world in Durban to match or better the renewable energy targets we have set ourselves and which we will meet next year,'" said Toloa.

"We will be among the first to go under water. Already we are suffering extreme weather, storm surges, droughts, coral-bleaching, inundation of land and groundwater salination. The islanders, who depend on fish, can grow only a few crops on their 12sq kilometres of land."

This year, because of a seven month long drought and a series of cyclones, which contaminated the underground water supplies, the islanders could not access water for the first time ever and have started to import it.

Other Pacific islands have considered relocating their populations, but not Tokelau. "We have no intention of leaving. This is a God-given land, we have a culture, a language, an identity and a heritage. We want to preserve Tokelau for future generations.

"My heart is heavy. Climate change does not distinguish between colour or race. It is an everyday reality here. It is our life. If nothing comes from this meeting, then we will continue to suffer," he said.

Tokelau's switch to renewables is expected to encourage scores of other islands. It expects to save 12,000 tonnes of CO2 over the life of the 1MW solar power plant – around 1,600 times the annual CO2 emissions of the average person in the UK. Tokelau will also have no more worries over changing fuel prices and intermittent supplies. "No more noisy generators will disturb the quiet of the islands. We will be an example to the world, even though we have done nothing to deserve this," said Toloa.

The only trouble is the tiny state must find $900,000 as its share of the $7.5m project. "That is why we are hoping that the green climate fund is established in the next few days. It is very urgent," he said..