Prime Minister John Howard will host the first meeting of the Asia-Pacific Partnership on Clean Development and Climate.
Environmentalists insist their protests will be peaceful and they will not blockade the city hotel where the international conference is due to take place.
Countries taking part in the meeting will be Australia, the United States, Japan, South Korea, China and India, who last year pledged to form a new climate initiative to bypass perceived problems in the Kyoto Protocol.
The US and Australia, which are among the major polluting nations, have refused to sign the Kyoto treaty.
The six nations account for almost half the world's population, energy and economic output, with China and India alone responsible for generating 20 per cent of the world's greenhouse gases.
US Secretary of State Condoleezza Rice has pulled out of the conference, as well as security talks with Australia this week, due to worries over the Middle East caused by the poor health of Israeli leader Ariel Sharon.
The Nature Conservation Council of New South Wales said hundreds of demonstrators would protest outside the climate-change conference, but pledged the action would be peaceful.
"We're expecting maybe a couple of hundred (protesters)," spokeswoman Mithra Cox said.
"We've been speaking to the police about it and we're not intending to blockade the Four Seasons Hotel. We'll just be protesting peacefully."
There were ugly scenes on Sydney streets in August when 1,000 anti-globalisation protesters descended on the Forbes conference at the Sydney Opera House, sparking clashes with police.
Nature Conservation Council director Cate Faehrmann said the Asia-Pacific Partnership on Clean Development and Climate was intended to scuttle the expansion of renewable energy sources.
"The talks are intended to divert attention away from solutions like renewable energy in favour of non-binding targets using technologies that don't even exist yet," she said in a statement.
"Renewable energy such as solar, wave and wind power is here and we know it works.
"The so-called Asia-Pacific Partnership is essentially a coal pact that allows Australia to continue to do next to nothing to stop climate change."
The conference would not set any binding targets for reducing greenhouse gases and would not recommend any immediate action, Ms Faehrmann said.