Despite a global collapse in the international prices for thermal and metallurgical coal, declining coal exports to Australia’s traditional export destinations, and strong signs from India and China that export growth to these markets will not continue, Australian governments at the state and federal level continue to act and behave as though the Australian coal industry has a bright future. Government optimism regarding the future of Australian coal has recently translated into state and federal approval for the Adani megamine project in Queensland’s Galilee Basin, even though the project is not considered financially viable by commercial banks, more than a dozen of which have refused to underwrite it to date.

Unperturbed by market signals, the Australian and Indian finance ministers held discussions in March with the current director of Australia’s sovereign wealth fund to provide a key source of finance for the project. This is in the context of more than one-third of Australian coal mines and half of thermal coal mines running at a loss, and well over 15,000 job losses at coal mines across Australia over the last three years. Goldman Sachs and Deutsche Bank are describing thermal coal as in structural decline, implying that any move by the Australian Government to underwrite the Adani project would be criminally incompetent. In the same month that these negotiations took place, the Indian energy minister announced that he intends to stop all coal imports within two to three years, and that solar energy in India is now cheaper than new-build coal.

Australia’s political elites appear to remain convinced that there is a bright future for coal, and that the future is Adani. This paper provides an update on the state of the coal industry in Australia subsequent to the publication of the author’s recent article in Energy Research and Social Science, ‘Stranded assets, externalities and carbon risk in the Australian coal industry: the case for contraction in a carbon-constrained world’ (2016). It details recent developments in Queensland, New South Wales, Western Australia and South Australia, and how several other controversies have recently emerged in relation to the industry which have placed further pressure on governments to rethink their ongoing commitment to coal.