Formation and energy emission of quasars are investigated in accord with the black hole universe, a new cosmological model recently developed by Zhang. According to this new cosmological model, the universe originated from a star-like black hole and grew through a supermassive black hole to the present universe by accreting ambient matter and merging with other black holes. The origin, structure, evolution, expansion, and cosmic microwave background radiation of the black hole universe have

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... fully explained in Paper I and II. This study as Paper III explains how a quasar forms, ignites and releases energy as an amount of that emitted by dozens of galaxies. A main sequence star, after its fuel supply runs out, will, in terms of its mass, form a dwarf, a neutron star, or a black hole. A normal galaxy, after its most stars have run out of their fuels and formed dwarfs, neutron stars, and black holes, will eventually shrink its size and collapse towards the center by gravity to form a supermassive black hole with billions of solar masses. This collapse leads to that extremely hot stellar black holes merge each other and further into the massive black hole at the center and meantime release a huge amount of radiation energy that can be as great as that of a quasar. Therefore, when the stellar black holes of a galaxy collapse and merge into a supermassive black hole, the galaxy is activated and a quasar is born. In the black hole universe, the observed distant quasars powered by supermassive black holes can be understood as donuts from the mother universe. They were actually formed in the mother universe and then swallowed into our universe. The nearby galaxies are still very young and thus quiet at the present time. They will be activated and further evolve into quasars after billions of years. At that time, they will enter the universe formed by the currently observed distant quasars as similar to the distant quasars entered our universe. The entire space evolves iteratively. When one universe expands out, a new similar universe is formed from its inside star-like or supermassive black holes.