Australia on Tuesday announced a Aus$500 million ($340 million) climate change package for Pacific island countries, which have been increasingly vocal in demanding their powerful neighbor curb its carbon emissions.
Prime Minister Scott Morrison said the funding, drawn from Australia's existing international aid budget, would help Pacific island nations invest in renewable energy and climate change resilience.
The climate-sceptic leader made the announcement before traveling to the Pacific Islands Forum (PIF) in Tuvalu, where island nations threatened by rising seas have vowed to put global warming at the top of the agenda.
Smaller members of the 18-nation grouping have been sharply critical of Australia's climate policies ahead of this year's summit amid a diplomatic push from Canberra to counter China's growing power in the region.
High-level representatives from the likes of Tuvalu, Palau and Vanuatu have criticized Australia for not doing enough, with Fiji's Frank Bainimarama saying Canberra's reliance on coal poses an "existential threat" to low-lying islands.
There has also been disquiet in the Pacific that Australia recently approved the giant Adani coal mine in Queensland state.
Morrison has staunchly defended Australia's climate record, insisting the country will meet its 2030 emissions reduction target set under the Paris Agreement.
"The $500 million we're investing for the Pacific's renewable energy and its climate change and disaster resilience builds on the $300 million for 2016-2020," he said in a statement.
"This highlights our commitment to not just meeting our emissions reduction obligations at home but supporting our neighbors and friends."
Greenpeace said the package was nothing more than a diversion of funds from Australia's Pacific aid program and "a slap in the face to regional leaders".
"This $Aus500 million accounting trick will do nothing to address the cause of the climate crisis that threatens the viability of the entire Pacific," Greenpeace's Pacific head Joseph Moeono-Kolio said in a statement.
The tussle over climate action comes as Australia attempts to reassert its influence in the Pacific through its "step-up" strategy, which some regional leaders have warned is likely to fail without meaningful climate action.
The PIF summit officially opens late Tuesday and continues until Thursday.