wsi confidential seasonal forecasting 101 dan leonard [email protected] dr. todd crawford...

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WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard [email protected] m Dr. Todd Crawford [email protected] om

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Page 1: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

Seasonal Forecasting 101

Dan [email protected]

Dr. Todd [email protected]

Page 2: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

Weather Forecasting and the Markets

• Energy Trading- Natural Gas, Oil and Power- Wind/Hydro/Solar

• Commodities• Insurance

Page 3: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

Seasonal Forecasting and Market Impacts

winter forecasts issued

• Traders initially hopeful for cold winter• Slow downward trend in price once reality of warm

weather sets in

Page 4: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

Updated Forecast Impact on the Markets

Updated morning forecasts trend colder

• Numerical computer models and medium range forecast changes can play a major role in short term prices

Midday models follow through

Page 5: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

Seasonal Forecasting @ WSI - Methodology

• Dynamical Climate Forecasting Model (NCAR CCM3.6) Run @ WSI Coarse resolution (2.5 x 2.5 deg), driven by initial ocean temp

anomalies 2 versions of model, complementary skill 8 runs (ensemble) per model version to further increase skill Ensemble mean is most skillful forecast

• 3 Proprietary Statistical Models Based on historical relationships between indices & weather Singular/Multivariate regression, analog

Page 6: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

Statistical Models

ENSO

Solar Cycle

PDO

Snow Cover

Index 20

Stat Model A

Stat Model B

Stat Model C

Page 7: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

Seasonal Forecast Process

Final Climate Model Output

WSI Final Forecast

Climate Model v1(raw)

Stat Model 2

Post-process

Climate Model v2(raw)

Post-process

Human touch

Blend all Inputs

Stat Model 3

Stat Model 4

Page 8: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

Seasonal Forecasting @ WSI – Overview

• Forecasts issued for US and Europe• US forecasts issued twice-monthly

Tuesday mid-month (between 13th-19th) Last trading day of month

• Temperature and precip forecasts producedNext three calendar months (Feb, Mar, Apr)Next two seasons (FMA, MAM)

• Tabular, graphical, and discussion format

Page 9: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

Forecasting Model Skill

Climate Model 57%

Stat Model A 59%

Stat Model B 56%

Stat Model C 59%

Ensemble Mean 61%

Models have similar skill

Seasonal Forecasting Tools - Skill

WSI Forecasts (October 2000-present) 64%

Page 10: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

So, What is “Normal” in an Ever-Changing Climate?

• 30-year normals are typically used since Atlantic/Pacific cycles

are on multidecadal time scales

• But these are only updated once a decade, mainly for convenience

• No reason why you can’t use 13, 26, or 36 year normals if they work better!

• Historically, which normals have worked best at predicting near-term temps?

Page 11: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

Which Normals are Best to Use Going Forward?

15-20 years: Recent trends, solar cycle?40-45 years: Pacific cycle

60 years: Atlantic cycle

Using standard 30-yr avg (changes once every 10 years) is even worse than using trailing 30-yr avg

Using standard 30-yeareven worse!

Page 12: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

New 30-yr normals (1981-2010 replaces 1971-2000)

Winter Summer

New Normals Warmer Most Locations, Especially during Winter

Page 13: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

Near-Term: Summer Temps Warming, Winter Cooling?

US Winter Temps

US Summer Temps

Page 14: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

Weather More Volatile Now?

189519031911191919271935194319511959196719751983199119992007-15

5

25

45

65

85

105

125

US Summer Temperature Rank

189519031911191919271935194319511959196719751983199119992007-15

5

25

45

65

85

105

125

US Winter Temperature Rank

“We’ve just had two consecutive top-5 warmest summers and two consecutive top-10 coldest winters.Are these sorts of extremes the newnormal?”

- September 15 ,1937

Page 15: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

• The last 2 winters in the US hottest back-to-back summers on record• 2011 2nd hottest summer on record, just behind 1936

1952

1955

1958

1961

1964

1967

1970

1973

1976

1979

1982

1985

1988

1991

1994

1997

2000

2003

2006

2009

-1.5

-1

-0.5

0

0.5

1

1.55-Yr Averaged US Summer Temp Anomalies

Ending Year of 5-Yr Period

Trend Towards Hotter Summers

Page 16: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

Atlantic Multi-decadal oscillation (AMO)

• Example of a positive phase of the AMO

•Tripole of water temp anomalies

Page 17: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

Atlantic Ocean pattern dictates US summer temperatures

Atlantic Multi-decadal Oscillation

Page 18: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

Trend Towards Colder Winters

• The last 5 winters in the US have been colder (in aggregate) than the long-term NCDC normals (1895-2010)

• This is the first time this has occurred since the winters of 1983/84 to 1987/88

• The “new normal”?

Page 19: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

Pacific Decadal Oscillation (PDO)

• PDO pattern displays a “horseshoe” effectin the SST anomalies, with cold temps bounded

by warm temps to the south, east and north

+ -

Page 20: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

The PDO/PNA connection

• A positive PDO favors the development of a positive Pacific/North America pattern (+PNA)

Page 21: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

Pacific Ocean pattern plays major role in US winter temps

Last cold winter regime1950s-1970s

Page 22: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

Positive Phase NAO

Mild westerly flow dominates Arctic air remains north

Warmer eastern/central US

Negative Phase NAO

Cold northerly flow into US Arctic air masses descend from north

Colder eastern/central US

North Atlantic Oscillation (NAO)

Page 23: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

North Atlantic Oscillation (NAO)

• NAO describes the strength of the polar vortex

• Strong vortex (pos NAO) = stronger Atl jet stream

• Weak vortex (neg NAO) = N Atl blocking, tapping Arctic air

• Last two winters have had extremely negative NAO

Page 24: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

NAO Correlations, Winter vs Summer

• Subtropical ridge tends to be more active in the summer

Winter Summer

Page 25: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

NAO clearly strongly related to US winter temps

Page 26: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

Mid-latitude October Atlantic SSTs modulate NAO

-AMO lends +NAO regime

Increased SST gradient =Enhanced polar jet

Decreased SST gradient =Weaker/amplified polar jet

+AMO lends -NAO regime

Page 27: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

Solar cycle minima enhance negative NAO

Page 28: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

Solar Cycles Through History

1660168217041726174817701792181418361858188019021924194619681990

-2

-1

0

1

2

3

4

5

6

7

Hadley Centre CET Winter Temps

• Hadley Centre (UK) oldest continuous temp measurements• Little Ice Age (1600s) occurred during solar blackout• Other cooling during solar minima in 1810s, 1900s, 1960s• Recent solar cycle weakest in at least 100 years

Page 29: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

Siberian Snow Cover – NAO correlations

Data suggests snow cover mostimportant during weeks 41-44 (October)

Asian snow cover build in October Impacts complex dynamic processes (Cohen et al.) that modulate blocking frequency/intensity

Pattern most sensitive to snow build inOctober due to rapidly increasing potential energy source as poles darken/cool

Page 30: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

Sudden stratospheric warmings drive negative NAO

In about half of all winters,dynamical processes producea sudden and extreme warmingof stratosphere (SSW)

This warming often propagatesback down to the polar surface, resulting in long-lived negative NAO events

Ability to predict whether a SSW event will occur in key to predictingwinter NAO

Have had SSW events in 8 of last 10 winters

Page 31: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

NAO Review

Primary NAO Drivers

• AMO• Solar Activity• Siberian Snowcover

in OCT• SSWs

Page 32: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

El Nino Forcing

Tropical convection enhanced over warmest SSTs – ridging poleward and downstream

WARM

Page 33: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

La Nina Impacts

Aggregate 500 mb pattern for last 14 mod/strong La Nina events

Focused convection produces downstream and poleward response at mid-latitudes over North Pacific and western US

Dateline ridging guides Arctic air intowestern Canada & western US

Cold water associated with La Ninafocuses tropical convection (t-storms) over Indian Ocean/Indonesia

Page 34: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

La Nina Seasonal Impacts – DJF Temperature

Aggregate temp. anom. pattern for last 15 mod/strong La Nina events

Strongest warm signal:13 of 15 events above-normalin south-central US

Strongest cold signal:11 of 15 events below-normalin north-central US

Page 35: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

Colder winters recently, regardless of ENSO state…

Last 3 winters coldest stretch since mid-1980s! Typical ENSO correlations failed the last 2 years

‘09-’10‘08-’09 ‘10-’11Strong El Nino Strong La NinaWeak La Nina

Page 36: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

Pacific Decadal Oscillation (PDO)

• PDO pattern displays a “horseshoe” effectin the SST anomalies, with cold temps bounded

by warm temps to the south, east and north

+ -

Page 37: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

If PDO/ENSO out of phase, textbook signal is gone

El Nino with positive PDO El Nino with negative PDO

Page 38: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

La Nina Stratified by NAO Phase

La Nina + Negative NAOLa Nina + Positive NAO

Cold north/west, warm south La Nina signal NAO provides offset to eastern/central US temps

Page 39: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

The Bottom Line

• ENSO taken alone is a poor predictor of seasonal variability over the lower 48

• NAO and PNA, although more difficult to predict, have a much stronger seasonal correlation

Page 40: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

Winter 07-08: A Winning Season

Page 41: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

Directionally Correct

WSI fcst obsWSI err

WSI dir correct?

Pacific -0.8 -1.0 0.2 YesMountain -0.2 -1.3 1.1 Yes

W. North Central -0.9 -1.5 0.6 YesW. South Central 1.1 2.3 -1.2 YesE. North Central -0.3 0.9 -1.2 NoE. South Central 1.4 2.6 -1.2 Yes

0.2 1.5 -1.3 YesMid-Atlantic 0.3 2.2 -1.9 Yes

1.1 2.9 -1.8 Yes

MAEWSI fcst

1.16

Dir corr 8 of 9

climo fcst 1.80

Anomaly correlation 0.88

Page 42: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

2011-2012 Forecast

• October forecast called for a cold winter north, especially in January

Page 43: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

A December Disaster

Sometimes Things Don’t Work Out According to Plan

Page 44: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

Rationale in October

Emerging La Nina Event

Strong Negative Pacific Decadal Oscillation

Warm North Atlantic(positive AMO)

Accelerating Snow Cover Build

Historically Low Arctic Sea Ice

• Positive signs for a cold winter north…

Page 45: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

Possible Wild Card: Different Tropical Pacific Convection Than 2010?

Warmer Indian Ocean, cooler Indonesia this year

More MJO phase 2/3 (warmer)activity this winter??

Page 46: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

Tropical Convection shifts east with time

-MJO starts the season over the Indian Ocean but eventually Progresses to a more typical Nina position over Indonesia

Page 47: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

Pacific Not to Blame

LA NIÑA

Don’t look at me!!

Classic –PDO/Nina setup

Persistent Convection

Mean Ridge Axis

Page 48: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

Look to the Atlantic/Arctic…

• Split flow pattern inthe west

• Very strong polar vortex

• Fast, zonal regimenorthern tier of the US

Page 49: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

2011-12 NAO: Positively Awful

• NAO has beenpositive since midNovember

• Most positive NAO ever inDecember

Page 50: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

State of the Stratosphere

• Stratosphere has been colder than normal so far,indicating a strong polar vortex

Page 51: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

Solar Spike

Solar Activity still relatively low but a sudden spike in November

Page 52: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

AMO Index: Missing the Smaller Picture?

Late Oct 2010 Late Oct 2011AMO = +0.367 AMO = +0.103

Page 53: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

• Extreme snow deficit for the north central, NE and Great Basin/NW.

• Positive snowfall anomalies confined to the southern plains and lower Rockies

Snowcover : Unpredictable but Important

Page 54: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

850mbT anom

SfcT anom

Snowless plains and midwest:

• Without snowcover, polar airmasses modify quickly

• Albedo correlation highest in tree-less areas like the plains

Snowcover’s Role in Airmass Modification

Page 55: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

Hope for a Back End Winter?

Both the GFS and ECMWF depict major SWE developing next week and intensifying during the following week

Page 56: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

Will the NAO finally flip negative?

-Good NorthAtlantic block

-Still a strong Pacific Jet

-PV is weaker and displaced, but not gone…

Page 57: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

Latest ECMWF Weekly

-NorthAtlantic block holds through first week of FEB

Page 58: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

February and March Forecast

-Cold and Stormy North and West

-Warm and dry South

Page 59: WSI CONFIDENTIAL Seasonal Forecasting 101 Dan Leonard dleonard@wsi.com Dr. Todd Crawford tcrawford@wsi.com

WSI CONFIDENTIAL

Seasonal Forecasting 101

Dan [email protected]

Dr. Todd [email protected]