By Leah Douglas

Aug 7 (Reuters) - The U.S. Epa has actually launched examinations into the supply chains of at least two eco-friendly fuel manufacturers amidst industry concerns that some might be utilizing deceptive feedstocks for biodiesel to protect lucrative federal government aids.

EPA representative Jeffrey Landis told Reuters that the agency has launched audits over the previous year, but decreased to identify the companies targeted since the examinations are continuous.

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

The concern entered focus following a rise in used cooking oil exports from Asia over the last few years that analysts have stated involves unrealistically high volumes relative to the quantity of cooking oil used and recovered in the region. The European Union is likewise examining feedstocks over the fraud concerns.

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

"EPA has actually conducted audits of sustainable fuel producers since July 2023 that includes, amongst other things, an assessment of the areas that utilized cooking oil utilized in eco-friendly fuel production was gathered," he said. "These investigations, nevertheless, are ongoing and we are unable to talk about ongoing enforcement investigations."

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

"The Biden administration has produced vigorous standards to confirm, not simply trust, American producers, and it is necessary that the same analysis is used to imported feedstocks," six 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 prompted the administration to exclude imported feedstocks like UCO from an additional tidy fuel tax credit program passed in the Inflation Reduction Act. (Reporting by Leah Douglas in Washington Editing by Richard Valdmanis and Matthew Lewis)