By Leah Douglas

Aug 7 (Reuters) - The U.S. Environmental Protection Agency has actually launched examinations into the supply chains of at least two eco-friendly fuel manufacturers amid market issues that some may be utilizing deceptive feedstocks for biodiesel to secure financially rewarding federal government aids.

EPA representative Jeffrey Landis informed Reuters that the firm has introduced audits over the previous year, but decreased to identify the companies targeted due to the fact that the investigations are continuous.

The production of biodiesel from sustainable components, like utilized cooking oil, can earn refiners a multitude of state and federal environmental and climate aids, including tradable credits under a program administered by the EPA called the Renewable Fuel Standard. But worries have been installing that some products labeled as utilized cooking oil are actually less expensive and less sustainable virgin palm oil, an item that is related to deforestation and other environmental damage.

The issue entered into focus following a surge in utilized cooking oil exports from Asia over the last few years that experts have actually stated includes unrealistically high volumes relative to the quantity of cooking oil utilized and recovered in the region. The European Union is also examining feedstocks over the fraud concerns.

The EPA audits started after the agency upgraded domestic supply-chain accounting requirements in July 2023 for sustainable fuel producers seeking to earn credits under the RFS, he said.

"EPA has carried out audits of sustainable fuel producers given that July 2023 that includes, to name a few things, an assessment of the places that used cooking oil utilized in sustainable fuel production was gathered," he stated. "These investigations, however, are ongoing and we are unable to talk about ongoing enforcement examinations."

U.S. senators from farm states have actually required more oversight of biofuel feedstocks, stating federal agencies must be as strenuous in verifying imports as they are auditing domestic supply chains.

"The Biden administration has produced energetic standards to confirm, not just trust, American producers, and it is important that the exact same scrutiny is used to imported feedstocks," 6 U.S. senators, led by Roger Marshall and Sherrod Brown, wrote in a June 20 letter to federal agencies.

Another letter from 15 senators to the Treasury Department on July 30 urged the administration to exclude imported feedstocks like UCO from an extra tidy fuel tax credit program passed in the Inflation Reduction Act. (Reporting by Leah Douglas in Washington Editing by Richard Valdmanis and Matthew Lewis)