By Jeff Tollefson

Senators John Kerry (D-Mass.) and Joe Lieberman (I-Conn.) released their much anticipated global warming bill on Wednesday, setting the stage for one last attempt to get climate legislation through the U.S. Senate this year. The duo has already lost the active support of a key partner, Lindsey Graham (R-S.C.) and many think already tricky political negotiations will only become more difficult in the wake of the oil spill in the Gulf of Mexico. Nature takes a closer look. (Scientific American is part of Nature Publishing Group.)

What would the bill do?

There are no surprises in terms of overall ambition. The bill would require a 17 percent reduction in global warming emissions by 2020 and some 80 percent by 2050, relative to 2005 levels. That is in the range of what has been proposed by President Barack Obama and aligns well with legislation that passed the House of Representatives last year.

What is the difference between this and earlier climate bills?

The biggest difference is in the architecture of the bill's cap-and-trade system--a market-based mechanism that sets a cap on overall emissions and then requires companies to obtain emission allowances to emit greenhouse gases.

Kerry, Lieberman and Graham have restricted their cap-and-trade system to large electric power utilities and factories, starting in 2013. Transport fuel providers--producers and refiners of oil--are treated differently. They would have to buy a block of allowances at a set price, effectively a kind of carbon tax.

The power sector's emission allowances would be handed out for free initially, with auctions phased in over time. Allowance prices within the carbon market would be constrained within a narrow range, starting at $12 to $25 per tonne, to provide predictability.

What else is in the bill?

The legislation contains a suite of incentives for various low-carbon technologies. Many are focused at renewables such as wind and solar, but others would support nuclear power and clean coal technologies. At the same time, any new coal-fired power plants would have to meet strict new standards that would effectively require them to capture and bury a portion of their emissions.

What about Senator Graham's absence, and the oil spill's effect on offshore drilling?

Graham was supposed to be present at the launch, and most consider it a significant setback that he was not. But his absence should not necessarily be taken as a sign of opposition. He initially walked away from the talks not because of a fundamental disagreement over the policy but because Democratic leaders decided to put immigration first.

Since then, he has said that the oil spill in the Gulf of Mexico could spur opposition among Democrats and environmentalists to provisions in the bill that allow for an expansion of offshore drilling along the coasts. But those provisions are popular among many moderate lawmakers, and it could be just as difficult to get a deal if they were dropped. Kerry and Lieberman maintained the drilling language but added provisions that would require more environmental analysis while offering states new ways to challenge such decisions.

What happens next?

Democratic leaders now say they will take up climate and immigration bills whenever they are ready, so the question is how fast the negotiations move. Senators have three months to pass a bill before the August recess, but the calendar is chock full with banking reform, a Supreme Court nomination and a host of spending bills. If the bill doesn't move this summer, it will be even more difficult to get anything done when lawmakers return--fully focused on November elections.

What are the odds that a deal could sneak through?

Conventional wisdom posits that it will be nearly impossible. But it is revealing that the lawmakers are still at work, months after most observers had already pronounced the effort dead. It may be in the best interests of many on both sides of the debate to strike a deal now. Democrats are likely to lose seats in the November elections, so passing a bill might be more difficult next year. On the other side, many companies are worried about looming greenhouse gas regulations that the U.S. Environmental Protection Agency has promised to roll out beginning next year. Some are inevitable, but in the absence of climate legislation, the Environmental Protection Agency has promised to move forward with a full-scale regulatory program that would cover all greenhouse gases under the Clean Air Act.