The Victorian ESC’s 2028 Water Price Review Draft Guidance raises an interesting question…
What happens when the regulator itself starts using AI?
The Draft Guidance signals a stronger focus on evidence, expenditure challenge, forecasting and demonstrating prudent and efficient expenditure.
As AI becomes embedded across Victoria’s water businesses, it seems inevitable that regulators will also begin exploring how AI can support their own decision-making.
Could AI help identify inconsistencies across price submissions?
Could it benchmark expenditure at a far more granular level?
Could it challenge forecasting assumptions, identify emerging risks and test regulatory precedent in ways that simply aren’t practical today?
Importantly, this isn’t about replacing regulatory judgement.
It’s about equipping regulators with better tools to interrogate evidence, improve consistency and focus their expertise where it adds the greatest value.
Part 2 in our series explores how AI could reshape the way economic regulation itself is undertaken.
As Victoria begins its 2028 price review, now seems an appropriate time to start thinking about what the next generation of regulation could look like.
