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By Leah Douglas

Aug 7 (Reuters) - The U.S. Epa has introduced investigations into the supply chains of at least 2 eco-friendly fuel manufacturers amid market concerns that some might be utilizing deceitful feedstocks for biodiesel to secure rewarding federal government aids.

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

The production of biodiesel from sustainable components, like used cooking oil, can earn refiners a variety 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 actually been mounting that some materials identified as utilized cooking oil are actually less expensive and less sustainable virgin palm oil, a product that is related to deforestation and other ecological damage.

The issue came into focus following a rise in used cooking oil exports from Asia in recent years that experts have stated involves unrealistically high volumes relative to the amount of cooking oil utilized and recovered in the area. The European Union is likewise investigating feedstocks over the fraud concerns.

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

"EPA has actually conducted audits of eco-friendly fuel producers considering that July 2023 which consists of, to name a few things, an examination of the places that used cooking oil used in eco-friendly fuel production was collected," he said. "These examinations, however, are continuous and we are not able to discuss ongoing enforcement investigations."

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

"The Biden administration has actually created vigorous standards to validate, not just trust, American producers, and it is important that the same scrutiny is applied to imported feedstocks," six U.S. senators, led by Roger Marshall and Sherrod Brown, wrote in a June 20 letter to federal companies.

Another letter from 15 senators to the Treasury Department on July 30 prompted the administration to exclude imported 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)