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By Leah Douglas

Aug 7 (Reuters) - The U.S. Epa has actually into the supply chains of at least two eco-friendly fuel manufacturers in the middle of industry concerns that some might be using deceptive feedstocks for biodiesel to secure financially rewarding government subsidies.

EPA spokesperson Jeffrey Landis informed Reuters that the agency has actually introduced audits over the previous year, but declined to identify the companies targeted since the examinations are ongoing.

The production of biodiesel from sustainable active ingredients, like used cooking oil, can earn refiners a variety of state and federal ecological and climate aids, including tradable credits under a program administered by the EPA called the Renewable Fuel Standard. But fears have been mounting that some supplies 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 ecological damage.

The issue entered into focus following a rise in used cooking oil exports from Asia over the last few years that experts have said involves unrealistically high volumes relative to the quantity of cooking oil used and recuperated in the area. The European Union is also examining feedstocks over the fraud concerns.

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

"EPA has performed audits of eco-friendly fuel manufacturers because July 2023 which includes, amongst other things, an examination of the places that utilized cooking oil used in eco-friendly fuel production was gathered," he stated. "These examinations, however, are continuous and we are not able to go over continuous enforcement investigations."

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

"The Biden administration has actually produced vigorous standards to verify, not simply trust, American manufacturers, and it is vital that the same scrutiny is used to imported feedstocks," six 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 prompted the administration to exclude 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)