By Leah Douglas

Aug 7 (Reuters) - The U.S. Epa has actually released investigations into the supply chains of a minimum of two eco-friendly fuel manufacturers amidst market concerns that some might be utilizing fraudulent feedstocks for biodiesel to protect financially rewarding government subsidies.

EPA spokesperson Jeffrey Landis told Reuters that the firm has launched audits over the previous year, however declined to identify the business targeted due to the fact that the investigations are continuous.

The production of biodiesel from sustainable components, like utilized cooking oil, can make refiners a slew of state and federal ecological and climate subsidies, consisting of tradable credits under a program administered by the EPA called the Renewable Fuel Standard. But worries have been mounting that some supplies identified as utilized cooking oil are in fact cheaper and less sustainable virgin palm oil, an item that is associated with deforestation and other environmental damage.

The concern entered into focus following a rise in used cooking oil exports from Asia in recent years that experts have actually said involves unrealistically high volumes relative to the amount of cooking oil used and recuperated in the area. The European Union is also examining feedstocks over the scams issues.

The EPA audits began after the agency 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 conducted audits of eco-friendly fuel manufacturers because July 2023 that includes, among other things, an examination of the places that utilized cooking oil used in eco-friendly fuel production was gathered," he stated. "These examinations, nevertheless, are ongoing and we are unable to discuss continuous enforcement examinations."

U.S. senators from farm states have called for more oversight of biofuel feedstocks, stating federal companies need to be as strenuous in confirming imports as they are auditing domestic supply chains.

"The Biden administration has actually produced vigorous requirements to confirm, not simply trust, American manufacturers, and it is essential that the same examination is applied 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 urged the administration to omit 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)