By Alister Doyle, Environment Correspondent

NAIROBI, Nov 9 (Reuters) - A U.S.-led coalition of some of the world's top-polluting nations will help clean up industries from coal-mining to steel with "minimal investments", the U.S. chief climate negotiator said.

Harlan Watson said the Asia-Pacific Partnership, often dismissed by environmentalists as a weak rival to the U.N.'s Kyoto Protocol for fighting global warming, could make a big difference for smokestack industries in China or India.

"There's obviously great potential" for cuts in toxic pollution and emissions of greenhouse gases, Watson said of the partnership of the United States, China, India, Japan, South Korea and Australia.

Speaking on the sidelines of a Nov. 6-17 U.N. climate conference, he said 100 new projects under the partnership to examine ways to clean up industries such as cement, aluminium and power generation, could yield benefits at low cost.

Washington has requested $52 million funding from Congress for 2007 for the partnership, based on voluntary actions and grouping countries with about half the world's population and accounting for more than half the world's energy use.

With "minimal investments in new equipment, just by operational practices" Watson said there was a potential to raise the efficiency of an Indian power plant, for instance, by perhaps two percent.

"That doesn't sound like much but it really adds up if you think about hundreds of gigawatts out there in existing power plants," he said. Mere consultations between U.S. and Indian experts could help more efficient practices.

NOT KYOTO RIVAL

"This is not meant from our point of view to compete with the Kyoto Protocol at all. In effect there's complementarity," Watson said. Unlike Watson, Australia's Prime Minister John Howard has said the scheme could be the basis of a "New Kyoto".

Kyoto sets binding caps on emissions of greenhouse gases, mainly from burning fossil fuels in power plants, factories and cars, for 35 industrial nations. Japan is the only member of the Asia-Pacific Partnership which is also bound by Kyoto.

Many environmentalists say the partnership is toothless.

"Unless you have a framework with strict timetables and targets like the Kyoto Protocol there's no guarantees that anything will be achieved," said Julie-Anne Richards of the Climate Action Network Australia.

She said that a Kyoto project for investments in clean energy in developing nations was channelling billions of dollars to China and India, far eclipsing the U.S.-led partnership.

President George W. Bush pulled out of Kyoto in 2001. He said caps on emissions would cost U.S. jobs and that a lack of participation by developing nations mars Kyoto.

Gases released by burning fossil fuels are widely blamed for global warming that many scientists say will bring rising seas, more floods, droughts and desertification.

Watson said the partnership could help speed up introduction of new technologies. "The basic theme is how do we get things off the shelf and get them into the marketplace," he said.

The scheme also involves industrial partners, such as American Electric Power <AEP.N>. "This is not a bunch of government bureaucrats talking to each other," Watson said.

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