The carbon tax repeal is likely to pass the Senate on Thursday after key crossbencher Ricky Muir backed away from a surprise demand.
The government now appears to have the numbers to push its package of repeal bills through parliament with the backing of at least six cross benchers.
Senator Muir on Wednesday indicated he would not push ahead with an amendment that would have blocked funding cuts to the Australian Renewable Energy Agency.
Instead he announced an agreement with the Palmer United Party to oppose the government's plans to abolish the agency altogether.
Legislation to that effect won't appear before parliament again until early September.
The government announced in the May budget its intention to save $1.3 billion over five years by scrapping the agency, which was created to fund renewable projects and drive research and investment.
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