FACTBOX-Ideas for a compromise U.S. climate bill

Feb 4 (Reuters) - Three U.S. senators are trying to broker a deal on a domestic energy and environment bill requiring reductions in greenhouse gas emissions, which are blamed for global warming.

The cap-and-trade bill that narrowly passed the House of Representatives last June does not have enough support to pass the Senate. Senators are hoping to have a compromise bill ready for debate by April, but it is not clear whether that will happen.

The three senators working to broker a deal are Democrat John Kerry, Republican Lindsey Graham and independent Joe Lieberman.

Alternatives are being weighed in the drive to attract 60 votes -- the supermajority needed in the 100-member Senate to pass controversial legislation. Following are some of those ideas, which may or may not make it into a Senate bill.

CAP-AND-TRADE FOR ONE SECTOR

Instead of the House's approach, which would establish an economy-wide cap-and-trade for utilities, oil refiners and large manufacturers, some senators are mulling cap-and-trade just for coal-fired power plants, according to sources.

Under cap-and-trade, carbon dioxide and other greenhouse gas emissions would be capped at a declining level during the next 40 years. Companies would need permits for every ton of pollution they send into the atmosphere and those permits could be traded on a regulated market.

About half of the electricity generated in United States is from coal-burning plants that produce close to 2 billion tons of carbon dioxide a year, according to the Pew Center on Global Climate Change. Those emissions account for about 27 percent of total U.S. greenhouse gas pollution and they are projected to grow by about a third in coming decades.

Coal is significantly cheaper to burn than most other fuels. Cap-and-trade aims to raise the price and encourage the private sector to develop and use cleaner power sources.

Kerry, who leads the charge for a climate change bill, this week said senators were "still working on precisely what carbon-pricing mechanism" will be employed. He also said decisions had not been made on whether pollution permits would be given or sold to industry if cap-and-trade or a similar mechanism is used.

CARBON TAX OR CAP AND DIVIDEND FOR OTHERS

A couple of ideas are circulating to clean up emissions from plants not covered by cap-and-trade for coal-fired utilities.

"Let's have a discussion about a carbon tax," Alaska Senator Lisa Murkowski told reporters.

It is unusual for any politician, especially a Republican such as Murkowski, to utter the word "tax" unless it is coupled with the word "cut."

Graham has some good things to say about a carbon tax, but says there is not enough support in the Senate to pass one.

An alternative could be cap-and-dividend, which is being promoted by Senators Maria Cantwell and Susan Collins. The idea is to impose a cap on dirty fossil fuels and compensate consumers for higher energy costs with a direct payment, or "dividend." It drops the Wall Street trading scheme for pollution permits.

NUCLEAR POWER INFUSION

Senate Republicans, including John McCain and Lamar Alexander, want the federal government to give more aid to the nuclear power industry, arguing that while it might not be a renewable fuel, it is a clean one. President Barack Obama's budget request seeks a tripling in loan guarantees to help the industry expand or build new plants, a move that's aimed at getting a handful of Republicans to support a climate bill.

Critics complain the industry could default on some loans, leaving taxpayers with the tab. They also say waste storage problems have not been resolved.

Besides more loan guarantees, a climate change bill also could include new tax incentives for the nuclear power industry and provisions aimed at streamlining the regulatory process.

TRADE PROTECTIONS

Senator Sherrod Brown, who represents the economically depressed state of Ohio, is pushing hard for language that would protect U.S. manufacturers against a flood of foreign imports from countries that do not embrace climate controls.

"They're (senators working on a bill) going to answer those concerns. There is no bill without dealing with manufacturers and what happens ... with Chinese and Indian goods undercutting ours," Brown told Reuters.

(Reporting by Richard Cowan; Editing by Will Dunham)