**1. Introduction**

Fuel ethanol helps to reduce harmful emissions from vehicles, contributing to the fight against climate change and the pursuit of clean mobility [1]. Moreover, as a kind of renewable energy made from sustainable biomass materials, fuel ethanol is an ideal substitute for the non-renewable fossil fuels [2]. Thus, fuel ethanol is expected to play a key role in the formation of a sustainable energy system. China is the largest consumer of fossil fuels and attaches grea<sup>t</sup> importance of the development of the fuel ethanol industry. In 2018, the fuel ethanol production capacity in China reached 3.22 million tons. China has become the third-largest fuel ethanol consuming and producing country, following Brazil and the United States [3]. However, China accounted for just over 3% of global production in 2018. The development of the fuel ethanol industry in China still faces many challenges (e.g., technical uncertainty, demand uncertainty, and feedstock uncertainty) [4–6]. The Chinese governmen<sup>t</sup> announced a new nationwide ethanol mandate that will expand the mandatory use of E10 fuel (gasoline containing 10% ethanol) from 11 trial provinces to the entire country by 2020. If China were to meet the national mandate of E10, it would require an extra 12 million tons of fuel ethanol production capacity, which is about four times that of its current production capacity. Therefore, exploring the nexus among the fuel ethanol industry, the uncertain technology system, and the uncertain market demand will be conducive to clarifying the growth mechanisms of the fuel ethanol industry and then improving public policy to accelerate the growth of the fuel ethanol industry in China.

Many scholars have already analyzed the di fferent factors that a ffect the development of the fuel ethanol industry. These factors mainly include technology change [7–10], market demand [11–13], feedstocks [8,14,15], renewable energy infrastructures [16,17], energy policies [18–21], and economic, social, and environmental impacts [22–25]. These works mainly used case studies [8,10], econometric methods [9,11,12,19], and simulation methods [7,13]. Although the existing literature provides important information on the relationships between the fuel ethanol industry growth and its drivers, there are still some limitations. Firstly, most studies do not consider the adverse impacts of the fuel ethanol industry on its drivers and the interrelationships among the driving factors. The ignorance of the above interactions may lead to a misunderstanding of the growth mechanisms of the fuel ethanol industry [26]. Secondly, the fuel ethanol industry is an emerging industry in China. Therefore, the econometric methods used in the existing studies could not be applied to analyze the development of the fuel ethanol industry in China due to the lack of statistical data. Lastly, although simulation is an ideal method to quantitatively analyze the development of emerging industries, such as the fuel ethanol industry, this method is often questioned because of the subjectivity of its parameter settings [27].

In addressing these limitations, this paper employs a history-friendly evolutionary model to explore the interactions among the fuel ethanol industry and its driving factors and analyze the impacts of di fferent policies on the evolution of the fuel ethanol industry in China. The contributions of our work are reflected in three aspects. First, we argue that there are multidirectional causalities among the fuel ethanol industry, the technology system, and the market system. Therefore, we applied a coevolutionary framework to model the above relationships. Under this framework, each party exerts selective pressures on the others, thereby a ffecting each other's evolution [28]. Second, we developed a history-friendly model to depict the above coevolutionary relationships related to the fuel ethanol industry in China. The parameters of the history-friendly model are set based on the historical evolutionary characteristics of the industry but not on historical statistics. Therefore, this method can be used to analyze the growth of the fuel ethanol industry, which lacks historical statistics in China. At last, we further analyzed the impacts of entry regulation, production subsidy, R&D subsidy, and ethanol mandate policy on the evolution of the fuel ethanol industry in China.

The rest of the paper is structured as follows. Section 2 reviews the driving factors that a ffect the growth of the fuel ethanol industry. Section 3 features a history-friendly model based on the coevolutionary framework, which describes the interactions among the fuel ethanol industry, the technology system, and the market system. In Section 4, we first run the baseline simulation to select the values of the parameters that can reflect the historical characteristics of the fuel ethanol industry and then use this model to further analyze the impacts of several typical fuel ethanol industry policies, while Section 5 contains concluding remarks and policy implications.
