It was a timely reminder of the foolishness of flinging $1 billion in taxpayers’ money at Indian coal magnate, Gautam Adani, and a project ultimately owned in a Caribbean tax haven; also of the latest madcap idea to force the Clean Energy Finance Corporation to squander money on “clean coal” projects to stimulate the coal-fired power plant industry.

While the government was busy reviving the myth of clean coal this week, the world was moving on. As China and India stick doggedly to their ambitious renewable energy programmes, signs emerged that Australia’s other big thermal coal customer, Japan, was starting to crack.

Entombed in the fine print to this week’s profits presentation by Japanese electricity generator Kansai Electric was another ominous slither of news for the Australian coal industry.

Citing a drop in electricity demand in Japan – now down 10 per cent from its 2010 peak – Kansai said it had abandoned plans to build a new $US3 billion import coal-fired power plant (1,200 MW).

Once firmly in Australia’s corner on fossil fuels, Japan has started to embrace the transition to renewables. Kansai talked about Japanese government policy to reduce carbon emissions in the power sector, as did its rival J-Power in a press release on Wednesday:

“Even the most advanced coal technology on offer now isn’t enough for companies like J-Power to meet Prime Minister Shinzo Abe’s emissions goal.”

Meanwhile, Australia’s leadership was busy resuscitating the myth of clean coal. Yes, clean coal does work, technically. It just doesn’t work economically. They’ve talked about building clean coal plants for 15 years but they cost too much.

Whether our elected officials are simply bewitched by the coal lobby, or whether they are entranced by the clean coal fairies like five year olds await the tooth fairy, is hard to tell. Party donations are probably the answer.

Despite the government and lobby group, the Minerals Council, preaching the salvation of clean coal, none are willing to put a price on how much these power plants cost.

Best guess is $75-$85 per megawatt hour; but that buys a new “ultra supercritical” coal fired plant, not carbon capture and storage (CCS). Include CCS, as Bloomberg New Energy Finance noted today, and the cost of a new plant is $150MW or higher.

Rack that up against the cost of a new solar or wind plant at $80MW and falling, and there is no contest.

So the latest harebrained idea to be entertained as Australia’s energy policy is to splash Clean Energy Finance Corporation (CEFC) funds on clean coal.

Following Prime Minster Malcolm Turnbull’s address to the National Press Club on Wednesday in which he said the government had spent $590 million on clean coal technology since 2009, Treasurer Scott Morrison floated the notion the CEFC should be deployed to finance clean coal.

Over the last two weeks, China has introduced initiatives to scale back and defer new coal-fired power plants, putting in place a hard-cap capacity peak of 1,100GW (down from 1,250GW previously). China’s policy is to defer and cancel fossil fuel projects, Australia’s is to sponsor new ones with taxpayers’ funds.

For its part, India, in its December 2016 Draft National Electricity Plan, concluded that no new coal-fired power plants were needed in the next decade. India has been the great hope for the seaborne thermal coal business and it reflects the determination by Energy Minister Piyush Goyal to shut down India’s thermal coal imports by the end of this decade.

It is worth noting Indian coal imports in December 2016 were down 25 per cent year on year and, yes, a resurgent coal price was largely responsible for Australia’s spectacular trade surplus revealed this week. Yet these are historical numbers.

The price of thermal coal had shot up but it is proving a dead-cat-bounce. The price has since receded from $US113 per tonne two months ago to $US84 per tonne and $US70 on the forwards market.

This week’s events in Japan, India and China suggest the outlook for thermal coal imports is decidedly weaker than a month ago, and moving in the opposite direction to that needed to support the case for Adani’s giant Carmichael coal project. The case for slotting Adani $1 billion in subsidies from the Northern Australia Infrastructure Fund to build the world’s biggest new thermal coal mine is as feeble as ever.

Finally, Adani Power reported its December 2016 results two weeks ago, a net loss of $US48 million for the quarter. Net debt was a heady $US7.3 billion. This is a company way below investment grade, so the concept of a pit-to-power plant integrated operation looks as unbankable as ever, especially given Adani’s sister company, which is supposed to be underwriting the coal off-take agreement for the next 30 years, is in financial distress and hardly a viable counter-party for any bank.

So, as Josh Frydenberg, Minister for Environment and Energy, was out spruiking clean coal and gas fracking this week; and as Minister for Resources Matt Canavan and George Christensen were out today talking up a variant of clean coal-fired plants for Northern Australia, our biggest customers in Asia are moving in the opposite direction, one more aligned with the commitments of the Paris Climate Agreement.

Yes, thermal coal will be part of Australia’s energy mix for years to come, and diverse sources of energy are required for energy security, but the profound lack of vision in energy policy continues to threaten this nation’s future.

As for the idea of new thermal coal mines, why flood the market and crush the price of our biggest exports at a time when the global price is already in retreat?

Postscript: Sid Marris, director of the Minerals Council joined the office of Prime Minister and Cabinet today (PMO), entrenching the long tradition of “revolving doors” between government and the mining industry in Australia.