By Leah Douglas

Aug 7 (Reuters) - The U.S. Epa has released examinations into the supply chains of at least two eco-friendly fuel producers amid market concerns that some might be using fraudulent feedstocks for biodiesel to secure lucrative federal government aids.

EPA representative Jeffrey Landis informed Reuters that the firm has actually launched audits over the previous year, but decreased to recognize the business targeted since the examinations are ongoing.

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

The problem entered into focus following a rise in utilized cooking oil exports from Asia recently that experts have actually stated includes unrealistically high volumes relative to the quantity of cooking oil used and recuperated in the area. The European Union is also investigating feedstocks over the fraud concerns.

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

“EPA has actually carried out audits of sustainable fuel manufacturers given that July 2023 that includes, to name a few things, an assessment of the areas that used cooking oil utilized in sustainable fuel production was collected,” he said. “These investigations, nevertheless, are continuous and we are unable to go over ongoing enforcement examinations.”

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

“The Biden administration has actually created energetic standards to confirm, not simply trust, American producers, and it is important that the same analysis is used to imported feedstocks,” 6 U.S. senators, led by Roger Marshall and Sherrod Brown, composed in a June 20 letter to federal companies.

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