By Leah Douglas

Aug 7 (Reuters) - The U.S. Environmental Protection Agency has introduced examinations into the supply chains of at least 2 sustainable fuel producers amid market concerns that some may be utilizing fraudulent feedstocks for biodiesel to protect lucrative federal government aids.

EPA spokesperson Jeffrey Landis told Reuters that the agency has actually released audits over the past year, but declined to determine the companies targeted since the examinations are continuous.

The production of biodiesel from sustainable components, like used 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 actually been mounting that some supplies identified as used cooking oil are really less expensive and less sustainable virgin palm oil, a product that is related to logging and other environmental damage.

The concern entered focus following a surge in used cooking oil exports from Asia in recent years that analysts have actually stated involves unrealistically high volumes relative to the amount of cooking oil utilized and recuperated in the region. The European Union is likewise examining feedstocks over the scams issues.

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

"EPA has performed audits of renewable fuel producers because July 2023 which consists of, to name a few things, an examination of the places that utilized cooking oil used in eco-friendly fuel production was gathered," he said. "These investigations, nevertheless, are continuous and we are not able to talk about continuous enforcement investigations."

U.S. senators from farm states have actually required more oversight of biofuel feedstocks, saying federal companies should be as strenuous in confirming imports as they are auditing domestic supply chains.

"The Biden administration has actually created vigorous standards to verify, not simply trust, American producers, and it is vital that the 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 companies.

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)