The US Environmental Protection Agency (EPA) has launched investigations into the supply chains of at least two renewable fuel producers amid concerns that some may be using fraudulent feedstocks for biodiesel in a bid to secure government subsidies.
EPA spokesperson Jeffrey Landis told Reuters that the agency had launched audits over the past year but declined to identify the companies involved as the investigations were ongoing.
Under the EPA-administered programme Renewable Fuel Standard (RFS), refiners can earn a range of state and federal environmental and climate subsidies, including tradable credits.
However, following a surge in UCO exports from Asia – involving high volumes relative to the amount of cooking oil used and recovered in the region – concerns had been raised that some supplies labelled as UCO were cheaper and less sustainable virgin palm oil, the 7 August report said.
The European Union was also investigating the alleged use of fraudulent feedstocks, Reuters wrote.
The EPA audits began after the agency updated domestic supply-chain accounting requirements in July 2023 for renewable fuel producers seeking to earn credits under the RFS, Landis said.
“EPA has conducted audits of renewable fuel producers since July 2023 which includes, among other things, an evaluation of the locations that UCO in renewable fuel production was collected,” he was quoted as saying.
“These investigations, however, are ongoing and we are not able to discuss ongoing enforcement investigations.”
Against this backdrop, US senators from farming states have called for tightened biofuel feedstock monitoring and have said that federal agencies should be as rigorous in verifying imports as they were auditing domestic supply chains.
“The Biden administration has created vigorous standards to verify … American producers, and it is imperative that the same scrutiny is applied to imported feedstocks,” six US senators, led by Roger Marshall and Sherrod Brown, wrote in a 20 June letter to federal agencies.
In another letter to the Treasury Department on 30 July, 15 senators had urged the administration to exclude imported feedstocks like UCO from an additional clean fuel tax credit programme passed in the Inflation Reduction Act (IRA), Reuters wrote.
