By Leah Douglas

Aug 7 (Reuters) - The U.S. Environmental Protection Agency has introduced investigations into the supply chains of at least 2 eco-friendly fuel manufacturers in the middle of industry concerns that some might be using deceitful feedstocks for biodiesel to secure rewarding federal government aids.

EPA spokesperson Jeffrey Landis informed Reuters that the company has released audits over the past year, but declined to identify the business targeted due to the fact that the investigations are ongoing.

The production of biodiesel from sustainable ingredients, like used cooking oil, can make refiners a multitude of state and federal environmental and environment subsidies, consisting of tradable credits under a program administered by the EPA called the Renewable Fuel Standard. But fears have been installing that some materials identified as used cooking oil are really cheaper and less sustainable virgin palm oil, a product that is associated with deforestation and other environmental damage.

The problem came into focus following a rise in utilized cooking oil exports from Asia recently that analysts have actually stated involves unrealistically high volumes relative to the amount of cooking oil used and recovered in the region. The European Union is likewise investigating feedstocks over the fraud concerns.

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

"EPA has actually performed audits of renewable fuel producers given that July 2023 that includes, among other things, an examination of the places that used cooking oil used in renewable fuel production was collected," he stated. "These investigations, nevertheless, are continuous and we are not able to go over continuous enforcement examinations."

U.S. senators from farm states have called for more oversight of biofuel feedstocks, stating federal firms must be as rigorous in verifying imports as they are auditing domestic supply chains.

"The Biden administration has actually developed vigorous requirements to confirm, not just trust, American manufacturers, 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 companies.

Another letter from 15 to the Treasury Department on July 30 advised the administration to omit 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)