By Leah Douglas

Aug 7 (Reuters) - The U.S. Environmental Protection Agency has launched examinations into the supply chains of at least 2 eco-friendly fuel producers in the middle of market concerns that some might be using fraudulent feedstocks for biodiesel to secure lucrative government aids.

EPA spokesperson Jeffrey Landis told Reuters that the firm has actually released audits over the previous year, but decreased to identify the business targeted due to the fact that the investigations are continuous.

The production of biodiesel from sustainable ingredients, like utilized cooking oil, can make refiners a slew of state and federal environmental and environment aids, consisting of tradable credits under a program administered by the EPA called the Renewable Fuel Standard. But worries have actually been installing that some supplies labeled as used cooking oil are really cheaper and less sustainable virgin palm oil, a product that is connected with deforestation and other environmental damage.

The issue entered into focus following a surge in utilized cooking oil exports from Asia in the last few years that analysts have actually said involves unrealistically high volumes relative to the quantity of cooking oil utilized and recuperated in the area. The European Union is likewise examining feedstocks over the scams concerns.

The EPA audits started after the agency updated domestic supply-chain accounting requirements in July 2023 for eco-friendly fuel manufacturers looking for to make credits under the RFS, he stated.

"EPA has actually carried out audits of renewable fuel manufacturers given that July 2023 that includes, to name a few things, an assessment of the places that utilized cooking oil used in renewable fuel production was collected," he stated. "These examinations, nevertheless, are continuous and we are unable to talk about continuous enforcement examinations."

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

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

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