The Gillard government won the historic vote in the upper house 36 to 32.
Labor and the Greens combined to pass the 18 "Clean Energy Future" bills just after midday Canberra time, to applause from the packed public galleries.
Finance Minister and former climate change minister Senator Penny Wong said that, on the Labor side of politics, "we accept the science, we accept the need to act [on climate change], and, like John Howard and Malcolm Turnbull, we accept the science and the advice that putting a price on carbon is the best way to reduce emissions."