By Leah Douglas

Aug 7 (Reuters) - The U.S. Environmental Protection Agency has introduced examinations into the supply chains of at least two renewable fuel producers amid market concerns that some may be using fraudulent feedstocks for biodiesel to secure financially rewarding federal government aids.

EPA spokesperson Jeffrey Landis informed Reuters that the agency has actually introduced audits over the past year, however decreased to recognize the companies targeted since the investigations are ongoing.

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

The concern entered focus following a surge in utilized cooking oil exports from Asia in current years that analysts have actually said includes unrealistically high to the quantity of cooking oil utilized and recovered in the region. The European Union is also investigating feedstocks over the scams concerns.

The EPA audits started after the firm upgraded domestic supply-chain accounting requirements in July 2023 for renewable fuel manufacturers looking for to make credits under the RFS, he stated.

"EPA has actually conducted audits of renewable fuel manufacturers considering that July 2023 which includes, among other things, an examination of the areas that utilized cooking oil utilized in eco-friendly fuel production was collected," he stated. "These examinations, nevertheless, are ongoing and we are not able to go over continuous enforcement investigations."

U.S. senators from farm states have actually required more oversight of biofuel feedstocks, saying federal firms need to be as rigorous in validating imports as they are auditing domestic supply chains.

"The Biden administration has actually produced energetic requirements to verify, not simply trust, American producers, and it is essential that the same scrutiny is applied to imported feedstocks," 6 U.S. senators, led by Roger Marshall and Sherrod Brown, wrote in a June 20 letter to federal agencies.

Another letter from 15 senators to the Treasury Department on July 30 urged the administration to omit imported feedstocks like UCO from an extra clean fuel tax credit program passed in the Inflation Reduction Act. (Reporting by Leah Douglas in Washington Editing by Richard Valdmanis and Matthew Lewis)