Labor and the Greens might not view it as a win but the Turnbull government's plan to direct the Clean Energy Finance Corp to invest in carbon capture technologies marks a retreat.

Back in February, when the government signalled it wanted to end the green bank's ban on carbon capture and storage (CCS) investments, Environment and Energy minister Josh Frydenberg said new coal-fired power stations could also be in the fund's sights.

Back then, Coalition MPs were braying for so-called high-efficiency, low-emission coal plants as the way to avoid power cuts like those in wind-dominant South Australia and the near-miss in coal-dependent NSW.

Tuesday's announcement means the CEFC will be spared looking at new coal. It's a recognition of sorts - as the Clean Energy Council noted this week - that large-scale wind and solar farms are cheaper than new fossil-fuel plants.

Of course, the government may conjure other ways to bankroll coal-fired power, and it could be holding fire until after the June 9 release of Chief Scientist Alan Finkel's energy security report.

Changing the CEFC won't be easy, with Labor and the Greens likely to block any removal of the current bar on CCS loans. (CCS is mostly an assembly of technologies well known to the oil and gas industry but making it cheap enough for power plants to capture their emissions and sequester them remains a big challenge, the International Energy Agency says.)

Opposition leader Bill Shorten took to social media with a "you've got to be kidding" tweet. Adam Bandt, the Greens climate spokesman, called the plan "a wacky idea", noting that even "coal-obsessed Donald Trump" was cutting CCS funding.

Mind, it's hardly the week to cite Trump as a climate model with the president reportedly about to pull America out of the Paris treaty.

In fact, leaving the CEFC to assess the merits of CCS is just about perfect.

As a report by the CO2CRC found, retrofitting a hypothetical 2100-megawatt brown coal-fired power station in Victoria (let's call it "Loy Yang A") would "conservatively" cost $2.45 billion per boiler.

The Australia Institute noted in a fortuitously timed report on Tuesday that Australian governments have poured $1.3 billion into CCS - starting with then environment minister Malcolm Turnbull in 2007 - with little to show for it.

(Watch this 2009 Lateline report with a coal industry chief predicting commercial-scale demonstration CCS plants would be up and running in Australia by 2015. None are close.)

Remember, the CEFC can only lend to projects with returns mostly 3-4 basis points above the five-year government bond rate - almost certainly ruling out CCS loans.

In other words, the CEFC is nothing like the Northern Australia Infrastructure Fund, now mulling $1 billion to support Adani's supposedly mega coal mine in central Queensland without such controls.

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