Energy UK response to Ofgem AI technical sandbox call for input

Executive Summary

Energy UK welcomes Ofgem exploring how to support innovation, decarbonisation, and consumer protection, through an AI technical sandbox. Given the rapid advancement of AI technologies, it is right that Ofgem is considering the appropriate oversight and safeguards needed, and is seeking to build its regulatory understanding.

Broadly, members were mixed in their views on whether an AI technical sandbox is needed and the benefit it could provide them. If Ofgem is minded to proceed with developing the sandbox, we recommend that it includes a clear value proposition for energy sector participants. This may require further consideration around which participants it would like to target for involvement, and tailoring the parameters accordingly. For example, does it want to attract those that could otherwise undertake similar exercises within their own business, and if so, what could the benefit be?

Further, we note that some members had concerns that Ofgem may facilitate stakeholder access to licenced parties’ data, without appropriate oversight or involvement by licenced parties in the sandbox. Some members also raised concerns about intellectual property rights, and the need for NDAs.

We would also recommend that Ofgem make clear if there would be any associated costs involved to participate, beyond participant time.

Finally, we note that given how fast AI technologies are evolving, application and involvement would need to be fast-paced to be useful for participants, while the findings from the sandbox would need to be shared swiftly.