By Leah Douglas

Aug 7 (Reuters) - The U.S. Environmental Protection Agency has actually launched investigations into the supply chains of a minimum of 2 eco-friendly fuel manufacturers in the middle of industry issues that some may be using deceptive feedstocks for biodiesel to protect profitable government aids.

EPA representative Jeffrey Landis informed Reuters that the agency has introduced audits over the past year, but declined to identify the companies targeted since the examinations are ongoing.

The production of biodiesel from sustainable ingredients, like utilized cooking oil, can earn refiners a variety 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 fears have been mounting that some supplies labeled as used cooking oil are actually less expensive and less sustainable virgin palm oil, a product that is associated with logging and other environmental damage.

The concern entered focus following a surge in used cooking oil exports from Asia recently that experts have stated involves unrealistically high volumes relative to the quantity of cooking oil utilized and recovered in the area. The European Union is also examining feedstocks over the scams issues.

The EPA audits began after the company updated domestic supply-chain accounting requirements in July 2023 for sustainable fuel manufacturers looking for to earn credits under the RFS, he said.

"EPA has performed audits of eco-friendly fuel producers given that July 2023 that includes, among other things, an examination of the places that used cooking oil utilized in sustainable fuel production was gathered," he stated. "These investigations, however, are continuous and we are not able to discuss continuous enforcement investigations."

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

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

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