The Republican-led Senate on Thursday overturned several key Biden-era waivers allowing California to set its own vehicle emissions, a major blow to that state’s effort to regulate pollution from cars and trucks that could have broad environmental impacts for the rest of the country.

The U.S. Senate voted to block California’s landmark mandate phasing out gas-powered cars, dealing a substantial blow to the state’s aggressive transition to electric vehicles.

The House budget bill that narrowly passed in an early morning vote on Thursday would effectively put the brakes on a clean energy production boom in the United States spurred by tax credits enacted i...