The Senate has voted down a bill to axe the carbon tax, depriving the Prime Minister of a much-touted election promise and setting the scene for another fight in July.

Months of debate came down to a single poll today, with legislation to remove the price on carbon defeated by 33 votes to 29.

Parties opposed to the Coalition’s ‘Direct Action’ plan say it is a win for scientifically-minded legislation over meaningless corporate hand-outs.

Supporters say the lost vote means the carbon tax will continue to cost jobs and hurt the economy, at least until July.

The vote may be raised again after the Senate changeover on July 1, which will see Clive Palmer's Palmer United Party step into key Upper House seats, in alliance with Motoring Enthusiasts Party senator Ricky Muir.

It is unclear what the Palmer-Muir coalition thinks about carbon pricing, though party leader and mining magnate Clive Palmer has criticised it in the past.

Interviews today have suggested Mr Palmer’s strongest opposition is to the attempted repeal of a $200 annual bonus to the children of Defence personnel killed in service. It is possible that he may be more keen to see the carbon legislation go if the defence allowances were kept.

The Federal Government has also tried to collapse the Clean Energy Finance Corporation (CEFC) as a key part of its cost-saving measures, aiming to replace the $10 billion fund for promoting renewable energy investment with a $3 billion fund that pays businesses to try and reduce harmful emissions.

Environment Minister Greg Hunt says the Government will continue trying.

“This is a $10 billion fund based on borrowed taxpayers' money,” he said.

“It's an extraordinary borrowing against the will of the Australian people who voted to change the government.

“It's part of the repeal of the carbon tax package and we'll just keep going until it's done.

Laws enforcing a three-month gap between Senate votes on the same bill are now in play, giving the Government time to refine its assault. After the second round it will have a valid reason to call a double dissolution vote, which would involve the re-election of all 12 Senate positions from each state.

“The Senate has rejected Tony Abbott's do-nothing approach on global warming and voted to maintain the price on pollution,” Greens leader Christine Milne said after the vote today.

“Without a credible alternative, Labor cannot support the abolition of the existing clean energy policies,” Opposition climate change spokesman Mark Butler said.