Australia's government is close to finalizing an agreement for its carbon trade scheme after months of deadlock, with the opposition expressing confidence in reaching a deal by early next week. The government aims to start carbon trading in July 2011, covering 75 percent of emissions, potentially creating the second domestic trading platform outside of Europe. However, the laws governing the scheme have faced obstacles in parliament due to strong opposition from rival lawmakers. To secure the necessary votes, the government has been negotiating changes with the main opposition bloc. Opposition negotiator Ian Macfarlane believes his side will now support a deal. Macfarlane expressed confidence that a satisfactory outcome will be reached that he can present to the party room for consideration. He remains optimistic that the party room will support the outcome. Negotiations on the laws, which were brought before the Senate on Tuesday, will persist throughout the week and into the upcoming weekend. The opposition is expected to vote early next week on whether to back or oppose the laws. The government has already agreed to a major opposition request to permanently exempt agriculture, which contributes to approximately 16 percent of Australian emissions, but the opposition is also seeking further concessions for coal miners. The Senate rejected the carbon trade bills in August and may result in an early election if they are rejected again this month. Prime Minister Kevin Rudd is pushing for the 11 bills to be passed before the global climate talks in Copenhagen in December. The Senate is set to adjourn on Nov. 26, but Rudd is open to extending the sitting if necessary. The opposition Liberal and National party coalition is split on climate policy, with opposition leader Malcolm Turnbull guaranteeing his lawmakers the opportunity to approve or reject any deal with the government. Disagreements within the coalition were evident during a closed-door meeting on Tuesday when 10 lawmakers suggested voting against the scheme regardless of negotiated amendments. However, more than 10 lawmakers expressed support for Turnbull's policy of negotiating changes, according to a party spokesman. Turnbull, who is trailing in opinion polls, is seeking a deal to avoid an early election. The government is currently seven seats short of a majority in the Senate. Junior Climate Minister Greg Combet stated on Tuesday that opposition divisions pose the biggest threat to the carbon trade scheme, which is a key aspect of Rudd's strategy to combat global warming. Combet noted that the coalition is divided, with the Nationals pursuing their own agenda and the Liberal and National parties at odds over climate change. The carbon debate in Australia is being closely observed internationally, especially in the United States and New Zealand, where lawmakers are discussing their own proposals for emissions trading. To learn more about the risks and opportunities related to carbon in Australasia, visit Carbon Central - Australia's Climate Change Hub, which features leading climate change experts and solution providers. For more news and analysis on global carbon markets, sign up for the free Carbon Interactive newsletter.