New York Commission Launches Inquiry Into Utilities’ Artificial Intelligence Use

The New York Public Service Commission on Sep. 17 opened a statewide review of how electric, gas, and water utilities are using artificial intelligence across their operations, marking one of the state’s first broad examinations of AI governance in the utility sector. The initiative will assess how companies deploy the technology, whether existing oversight is sufficient, and whether additional safeguards are needed to protect consumers and critical infrastructure as AI becomes more embedded in essential services.

The review covers major utilities including Consolidated Edison, National Grid, Central Hudson, New York State Electric and Gas, Rochester Gas and Electric, Orange and Rockland Utilities, National Fuel Gas Distribution, Liberty Utilities, and Veolia Water New York. Within 60 days, each company must submit a comprehensive inventory of AI applications and disclose the internal policies, procedures, and safeguards that govern their use.

The commission identified several risks associated with AI, including inaccurate outputs, algorithmic bias, cybersecurity threats, data privacy concerns, configuration errors, limited transparency, and system reliability issues. The regulator will evaluate utility practices against widely recognized AI governance frameworks to determine whether existing controls are robust enough for critical infrastructure.

The review adopted a broad definition of AI that extends beyond generative tools to include machine learning, natural language processing, computer vision, and other systems capable of making predictions, recommendations, or decisions that influence real or virtual environments.

The action reflects growing regulatory attention to the expanding role of AI in utility management. Many companies now rely on the technology for customer service, predictive maintenance, and facility inspections, creating new operational opportunities alongside emerging risks. The commission’s findings could shape future oversight of AI in New York’s utility industry by establishing clearer expectations for governance, transparency, and accountability as adoption accelerates across essential energy and water services.