By Leah Douglas

Aug 7 (Reuters) - The U.S. Environmental Protection Agency has launched investigations into the supply chains of at least two sustainable fuel producers in the middle of industry issues that some might be using deceptive feedstocks for biodiesel to secure lucrative federal government aids.

EPA representative Jeffrey Landis informed Reuters that the company has launched audits over the previous year, however decreased to determine the business targeted due to the fact that the investigations are ongoing.

The production of biodiesel from sustainable ingredients, like utilized cooking oil, can earn 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 fears have actually been mounting that some materials identified as used cooking oil are really more affordable and less sustainable virgin palm oil, a product that is associated with deforestation and other environmental damage.

The concern came into focus following a surge in used cooking oil exports from Asia in the last few years that experts have stated includes unrealistically high volumes relative to the amount of cooking oil used and recovered in the area. The European Union is also investigating feedstocks over the scams concerns.

The EPA audits started after the firm updated domestic supply-chain accounting requirements in July 2023 for eco-friendly fuel manufacturers seeking to earn credits under the RFS, he stated.

"EPA has actually conducted audits of sustainable fuel manufacturers considering that July 2023 that includes, to name a few things, an assessment of the places that used cooking oil utilized in sustainable fuel production was collected," he said. "These investigations, however, are ongoing and we are unable to talk about continuous enforcement examinations."

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

"The Biden administration has created vigorous requirements to confirm, not simply trust, American producers, and it is essential 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 companies.

Another letter from 15 senators to the Treasury Department on July 30 urged the administration to leave out 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)