Prime Minister Kevin Rudd has told world leaders in Bali that climate change is the defining challenge of this generation, and says Australia stands ready to respond to the problem.

The community of nations must reach agreement. There is no plan B. There is no other planet any of us can escape to. We only have this one.

He told delegates at the United Nations climate change conference in Bali today that Australia would commit to "real" and "robust" short and medium term targets to slash greenhouse gases, after the Garnaut review is finished next year.

Mr Rudd received enthusiastic applause as he was introduced at the high-level segment of the Bali talks, after earlier formally handing over the instrument of ratification of the Kyoto Protocol to UN Secretary-General Ban Ki-Moon.

"It will require tough choices, and some of these will come at a political price," he said.