Some in the administration still hope to revive the legislation this year, although the preoccupation of congress members has already shifted to election campaigning.
Forced to accept political reality, Democrat Senate majority leader Harry Reid yesterday said that his party would instead pursue a more limited energy bill this year that concentrated on combating the BP oil spill in the Gulf of Mexico and improving efficiency standards.
Expressing his disappointment at dropping the broader bill, Senator Reid said: “We don’t have a single Republican to work with us. We don’t have the votes.”
Mr Obama’s White House director of energy and climate change policy, Carol Browner, said: “Everyone is disappointed.”
Democrats needed a “super-majority” of 60 votes out of 100 in the Senate to pass a proposed climate change bill with an emissions scheme — but fell at least two short and possibly more if their party fragmented.
Many Democrats have been under pressure from voters working in high carbon emission industries to reject greenhouse gas limits.
The House of Representatives, where the Democrats have a resounding majority, passed its own version of a climate change bill last year that was still to be merged with Senate legislation.
Mr Obama has staked much political capital on winning Senate support for legislation backing a 17 per cent reduction on 2005 carbon emissions by 2020.
Just as Kevin Rudd did, Mr Obama took his position to the UN climate change summit in Copenhagen in December, only to see no common agreement.
Mr Rudd wanted a 5 per cent emissions cut on 2000 levels by 2020 and also pushed to introduce a cap-and-trade scheme, but he dropped his government’s legislation this year when it was blocked in the Senate by the Coalition.
The push for US climate change legislation had been in doubt for months. The main prospect of success rested on a senior Republican, Lindsey Graham, joining a coalition with Democrat John Kerry and independent Joe Lieberman, and possibly luring some Republicans to go with them.
Senator Graham bowed out last month, saying he could no longer back a joint plan.
Without legislation, Mr Obama’s opportunity to curb emissions relies on the US Environmental Protection Agency using its powers to control dangerous pollutants.
The blow to Mr Obama’s climate change agenda yesterday came as the US Senate agreed, after resistance, to pass an extension of emergency unemployment benefits.
Mr Obama also signed into law new financial regulations to limit the behaviour of banks, following the passage of legislation by the Senate.