By Leah Douglas

Aug 7 (Reuters) - The U.S. Epa has actually released investigations into the supply chains of a minimum of two sustainable fuel manufacturers amid market issues that some may be utilizing deceptive feedstocks for biodiesel to secure rewarding government subsidies.

EPA spokesperson Jeffrey Landis told Reuters that the agency has launched audits over the past year, but declined to determine the companies targeted due to the fact that the examinations are ongoing.

The production of biodiesel from sustainable active ingredients, like utilized cooking oil, can make refiners a slew of state and federal environmental and climate aids, including tradable credits under a program administered by the EPA called the Renewable Fuel Standard. But fears have been installing that some supplies labeled as utilized cooking oil are really more affordable and less sustainable virgin palm oil, a product that is associated with logging and other environmental damage.

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

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

"EPA has actually conducted audits of sustainable fuel producers since July 2023 that includes, to name a few things, an assessment of the locations that utilized cooking oil utilized in renewable fuel production was collected," he stated. "These examinations, nevertheless, are ongoing and we are unable to go over continuous enforcement examinations."

U.S. senators from farm states have required more oversight of biofuel feedstocks, stating federal firms must be as extensive in validating imports as they are auditing domestic supply chains.

"The Biden administration has produced vigorous requirements to confirm, not simply trust, American manufacturers, and it is necessary that the exact same analysis is applied to imported feedstocks," six 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 advised the administration to exclude 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)