ABSTRACTAs air pollution becomes increasingly critical, ‘near-zero emission’ technological innovation in coal-fired plants are needed for the government and public consumers. The aim of this paper is to build the evolutionary game for analysing ‘near-zero emission’ technological innovation diffusion in coal-fired plants. According to bionics research of evolution, this paper introduces the co-evolutionary algorithm to simulate the diffusion. By modelling the evolutionary gaming behaviour of coal-fired plants, the simulation can capture the dynamics of coal-fired plants' strategy, which is adopting ‘near-zero emission’ technological innovation or not. It is key to model the diffusion under the electricity market and government regulation because it can provide some suggestions for promoting the diffusion. Simulations show that with no government regulations, the coal-fired plant fails to adopt the ‘near-zero emission’ technological innovation. However, the coal-fired plant for most profit should adopt independent RD for ‘near-zero emission’ technology when the government provides subsidy incentives for the low-pollution coal-fired plant. With the promotion of subsidy incentives, all coal-fired plants will adopt ‘near-zero emission’ technology. Moreover, increasing the subsidy intensity has a significant role in promoting the diffusion.
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