Australia's parliament rejected controversial carbon cuts ahead of UN climate talks on Wednesday, dealing a heavy blow to Prime Minister Kevin Rudd who also passed up the chance to call snap polls.
The upper house, or Senate, voted down the scheme 33 to 41 after days of tumultuous debate which saw the opposition Coalition leader deposed by a maverick climate-change sceptic.
The legislation's second failure since August gave Rudd powers to dissolve parliament and call early elections. But the government opted not to exploit the opposition's turmoil and instead said the bill would be reintroduced.
"We will come to parliament again, we will seek passage of the bill," Deputy Prime Minister Julia Gillard told reporters. "All options are on the table as to what happens next."
The legislation's failure is deeply embarrassing for the pro-green Rudd, who is set for a lead role at the Copenhagen UN summit but presides over a country that remains the world's worst per capita polluter.
His Carbon Pollution Reduction Scheme (CPRS) aimed at cutting emissions blamed for global warming by between five and 25 per cent from 2000 levels by 2020, depending on what action is taken at the UN summit this month.
But it ran into strong objections from the industrial and agriculture lobby as well as the conservative opposition, which ousted its leader Malcolm Turnbull on Tuesday for supporting the cuts.
"What we are debating is whether the science of climate change is real or not. That debate is over," said Greens senator Christine Milne.
Australia now heads to the December 7-18 summit, aimed at thrashing out a successor to the Kyoto Protocol, without an agreement to cut emissions despite pledges from the United States and China, the two biggest polluters.
Commonwealth leaders, representing a third of the world's population, also said a legally binding climate agreement was "essential," adding to hopes that the 190-nation talks will be a success.
"There's no danger of this country rushing ahead, but as a result of the actions of those opposite there's a risk we will be left behind," climate change minister Penny Wong warned.
The European Union has vowed to reduce its emissions by 20 per cent from 1990 levels before 2020, rising to 30 per cent in the event of an international agreement. Japan has offered 25 per cent, but attached conditions.
Rudd would have been seen as the strong favourite in any early election against Tony Abbott, the charismatic but gaffe-prone right-winger who became surprise opposition leader on Tuesday.