Australia is the developed world’s worst polluter per head of population.
Australia’s Senate has approved a controversial law on pollution, after years of bitter political wrangling.
The Clean Energy Act will force the country’s 500 worst-polluting companies to pay a tax on their carbon emissions from 1 July next year.
The Senate vote is a victory for Prime Minister Julia Gillard, who had given strong backing to the plan. Environmentalists have broadly backed the scheme, but there have been large public protests against it.
Opposition parties have argued that the tax would cause job losses and raise the cost of living, and they have promised to repeal the legislation if they win the next election, due in 2013.