Imagine a world where grading isn't just about scores, but about truly understanding where students excel and where they need a little extra help. That's the promise of a new AI system, designed to provide not only grades, but also rich, tailored feedback to help students learn and grow. In the past, automatic short answer scoring (ASAS) systems have focused primarily on giving a number or a simple "correct" or "incorrect." This new research moves beyond that, exploring a system that uses retrieval augmented generation (RAG) to give students more meaningful insights into their work. The system works by pulling in similar examples from a database, which helps the AI create feedback that’s specific to the student’s response. This approach not only improves the accuracy of scores by a significant 9% compared to older methods but also makes the system more flexible and adaptable to different kinds of questions without constant tweaking. The results are pretty impressive. In tests, the system, especially using the Mistral 7b language model, outperformed existing grading models, particularly when faced with questions it hadn't seen before. This adaptability opens exciting possibilities for education, where the AI could handle new topics and question formats with ease. Of course, providing truly helpful feedback is a complex challenge. Researchers found that while the AI is great at scoring, there’s still room for improvement in the quality and clarity of its feedback. While traditional metrics like BLEU scores showed improvement, the real test came down to what educators thought. Human evaluations showed that there's still a gap between what the AI provides and the detailed guidance a teacher can offer. The future of this technology depends on closing that gap, making the feedback not just accurate but truly insightful for learners. This will likely involve further research into more advanced language models and better ways to evaluate feedback effectiveness. This innovative system shows that personalized feedback is within reach, potentially freeing up teachers to focus on what they do best: guiding students towards deeper understanding and growth.