Major Growth in Some Business-Related Uses of Climate Information

摘要

Uses of climate information have grown considerably in the past 15 years as a wide variety of weathersensitivebusinesses sought to deal effectively with their financial losses and manage risks associated withvarious weather and climate conditions. Availability of both long-term quality climate data and new technologieshas facilitated development of climate-related products by private-sector atmospheric scientists anddecision makers. Weather derivatives, now widely used in the energy sector, allow companies to select a financiallycritical seasonal weather threshold, and, for a price paid to a provider, to obtain financial reparationif this threshold is exceeded. Another new product primarily used by the insurance industry is weather-riskmodels, which define the potential risks of severe-weather losses across a region where few historical insuredloss data exist. Firms develop weather-risk models based on historical storm information combined with atarget region’s societal, economic, and physical conditions. Examples of the derivatives and weather-riskmodels and their uses are presented. Atmospheric scientists who want to participate in the development anduse of these new risk-management products will need to broaden their educational experience and developknowledge and skills in fields such as finance, geography, economics, statistics, and information technology.