Scenarios: Outlook for climate bill in Congress

WASHINGTON (Reuters) - Prospects for compromise on U.S. climate change legislation that had been expected to be unveiled in the Senate on Monday suffered a blow after a Republican senator helping to write the bill pulled out of negotiations.

A bipartisan group of senators led by Democrat John Kerry had been aiming to release details of the bill on Monday.

But the unveiling was canceled after Republican Senator Lindsey Graham said in a letter on Saturday he would no longer take part in the talks if Democrats pushed to debate immigration reform before the energy and climate bill.

The climate plan had already been facing an uphill battle.

Here are possible outcomes for the legislation if Graham rejoins the effort or Kerry finds other Republican supporters for the bill that aims to reduce U.S. emissions of greenhouse gases blamed for global warming.

DEADLOCK

The Senate cannot manage to get the 60 votes necessary to overcome procedural hurdles against either comprehensive climate change legislation or more narrow energy-environment bills.

In that case, supporters will argue that great progress has been made with the 2009 House passage of a bill, approval of a Senate Environment and Public Works Committee measure and significant work on a compromise that at least brought some Republicans, moderate Democrats and many industry groups into the conversation.

The next Congress, in 2011, would try again, but it could be an even tougher battle as the Democrats' strength likely will be diluted by the November elections.

SOME OF IT GOES ALL THE WAY

Instead of passing comprehensive climate change legislation with firm targets for reducing carbon dioxide emissions, only a smaller step is politically feasible.

This likely would be in the form of the alternative energy measure approved by the Senate Energy and Natural Resources Committee last year that would place new requirements on electric power utilities to use wind, solar and other clean energy sources.

There also could be opportunities for passing new tax incentives to help develop green energy.

IT GOES ALL THE WAY

There's widespread agreement that enactment of a bill this year is very difficult. But things could line up to make it happen. Here's how:

* Senators Kerry, Graham and Joseph Lieberman regroup to unveil a bill that wins some strong business and industry support and merely tepid opposition from those who otherwise might savage it.

* The Senate doesn't get too hung up on financial regulatory reform, immigration reform, a Supreme Court nomination or anything that would take away time from debating the climate change bill in June or July. (A Washington heat wave during those months might not hurt it, either.)

* The U.S. economy shows further signs of improving, thus making it somewhat less politically risky to vote for a bill that would raise domestic energy prices. And, supporters make a convincing case that the climate bill creates jobs.

* President Barack Obama becomes heavily engaged in pushing for passage.

* If the Senate passes a bill, the House of Representatives is willing to compromise on its already-passed measure, which doesn't have strong incentives to expand nuclear power and offshore oil drilling.

Approval of a compromise bill by a House-Senate negotiating panel clears the way for each chamber to vote on final passage and send a bill to Obama for signing into law, in September or October.

(Reporting by Richard Cowan and Timothy Gardner; Editing by Eric Walsh)