WEMO24-Compiled Report-Interactive compressed (002) 4154-7882-8116 v.1 - Flipbook - Page 254
Market Data
Money Market Regulations
ENERGY IN
THE REGIONS
HOME
AI regulations in energy and utility
FIGURE 43
Governments are proposing AI regulations for the energy and utility sectors, though comprehensive regulations are still lacking (1/3)
Evolving Rules
& Regulations
What Does It Address?
• The European Union’s long-awaited and much-debated AI Act, which was formally adopted by the European Parliament on 13 March 2024, addresses the rapid advancement and integration of
arti昀椀cial intelligence technologies across sectors, including the entire energy value chain, as organizations work to develop responsible AI solutions
• EU AI Act is a law that will govern the development and/or use of artificial intelligence (AI) in the European Union (EU). The act takes a risk-based approach to regulation, applying different rules
to AI according to the risk they pose. The EU AI Act applies to multiple operators in the AI value chain, such as providers, deployers, importers, distributors, product manufacturers and authorized
representatives).
• The Commission is asked to request European standardization organizations to produce a standardization deliverable on reporting and documentation processes to improve AI systems’ resource
performance, such as reduction of energy and other resources consumption of the high-risk AI system during its lifecycle, and on energy e昀케cient development of general-purpose AI models.
• The EU AI Act regulates AI systems based on risk level. Risk here refers to the likelihood and severity of the potential harm. Some of the most important provisions include:
EU AI Act
• a prohibition on certain AI practices that are deemed to pose unacceptable risk,
• standards for developing and deploying certain high-risk AI systems,
• rules for general-purpose AI (GPAI) models.
• AI systems that do not fall within one of the risk categories in the EU AI Act are not subject to requirements under the act (these are often dubbed the ‘minimal risk’ category), although some may
need to meet transparency obligations and they must comply with other existing laws.
• in employment contexts, such as those used to recruit candidates, evaluate applicants, and make promotion decisions
• in certain medical devices
• in certain education and vocational training contexts
• in the judicial and democratic process such as systems that are intended to in昀氀uence the outcome of elections
• to determine access to essential private or public services, including systems that assess eligibility for public bene昀椀ts and evaluate credit scores.
• in critical infrastructure management (e.g. water, gas and electricity supplies etc.)
• in any biometric identi昀椀cation system which are not prohibited, except for systems that whose sole purpose is to verify a person’s identity (for example, using a 昀椀ngerprint scanner to grant
someone access to a banking app).
Source: 2024 Lazard's Levelized cost of Energy Analysi
WEMO 2024
The act also lists speci昀椀c uses that are generally considered high-risk, including AI systems used:
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