By Leah Douglas

Aug 7 (Reuters) - The U.S. Environmental Protection Agency has released investigations into the supply chains of at least two sustainable fuel manufacturers amidst industry issues that some may be utilizing deceptive feedstocks for biodiesel to protect lucrative federal government aids.

EPA representative Jeffrey Landis informed Reuters that the company has launched audits over the past year, however decreased to recognize the companies targeted because the investigations are ongoing.

The production of biodiesel from sustainable components, like utilized cooking oil, can make refiners a slew of state and federal ecological and climate subsidies, including tradable credits under a program administered by the EPA called the Renewable Fuel Standard. But worries have been mounting that some supplies identified as utilized cooking oil are actually more affordable and less sustainable virgin palm oil, a product that is connected with logging and other ecological damage.

The problem entered into focus following a rise in used cooking oil exports from Asia recently that experts have stated involves unrealistically high volumes relative to the amount of cooking oil utilized and recovered in the region. The European Union is likewise investigating feedstocks over the scams concerns.

The EPA audits began after the agency updated domestic supply-chain accounting requirements in July 2023 for eco-friendly fuel producers looking for to earn credits under the RFS, he said.

"EPA has conducted audits of renewable fuel producers considering that July 2023 which includes, to name a few things, an assessment of the places that utilized cooking oil utilized in sustainable fuel production was gathered," he said. "These examinations, however, are ongoing and we are unable to go over continuous enforcement investigations."

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

"The Biden administration has actually developed vigorous requirements to verify, not just trust, American manufacturers, and it is necessary that the exact same examination is used 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 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)