2024 Winter Outlook

POWWR’s Summer outlook can be seen in Figure 1. We forecasted peak warm anomalies in the western Midwest / Great Lakes region with an overall warm pattern east of the Rocky Mountains and a cool West. One thing to note is that our forecast did not call for anomalous warmth in ERCOT.

Fig. 1

May through September actual temperature anomalies are shown in Fig. 2. We were generally in the ballpark in calling for a cool West / warm east of the Rockies, with ERCOT not exceedingly hot. We should have shifted our axis of warmth further to the East Coast from the Midwest. Regarding the tropical situation, we called for 18 named storms, 11 hurricanes, with 5 of major intensity with the bulk of the activity to center on the Gulf of Mexico from TX to FL. Through early-mid October, there have been 13 named storms, 9 hurricanes, with 4 major. And there is still another 6 weeks remaining in the season as I write this report.

Fig. 2

Winter 2024-25

El Nino / La Nina Conditions

For winter, the state of the El Nino -Southern Oscillation (ENSO) is paramount to getting a handle on what winter could become. This is the single, most important ocean-atmosphere teleconnection that climatologists and meteorologists can use to narrow down the outcome of seasonal weather in an almost infinite array of possibilities. While we are currently in an “ENSO Neutral - La Nina Watch” status, climate models are almost unanimously in favor of La Nina conditions developing in the coming months, Fig. 3. NOAA’s Climate Prediction Center reports on 9/12/2024 that, “La Niña is favored to emerge in September-November (71% chance) and is expected to persist through January-March 2025. Personally, I thought that the Nina would have been stronger at this point in late summer. Given that it is not, there is a good chance that this Nina may be weak. If so, the “typical” Nina temperature anomalies may not be representative of Winter 2024-25.

Fig. 3

Arctic Ice

Arctic sea ice typically reaches a minimum in mid-September. This year is no different, Figure 4.

Fig. 4

In the Fall, as daylight becomes less and less, Arctic temperatures get colder and sea ice reforms. The pace of sea ice retreat this summer has been very close to the long-term (1981-2010) rate of retreat. As we have recently begun the sea ice building process and there is less sea ice from which to build on, there is far less areal coverage than the long-term average, Fig 5.

Fig. 5

Soil Moisture

Soil moisture is a very short-term index and can rapidly change. Its impacts on winter temperatures are subtle. In a nutshell, drier conditions can lead to enhanced cooling while wetter conditions lead to some slight warming modification of the cold air mass. Figure 6 shows soil moisture conditions across the continental US as of Oct 8. It is readily apparent that soil moisture is lacking to some extent in a majority of the country. Only the Southeast stands out as having normal moisture, as a result of Hurricane Helene.

Fig. 6

POWWR’s Winter Outlook

Given the prediction of a moderate to mild La Nina, our winter outlook can be seen in Fig. 7.

Fig. 7

We are calling for generally cold conditions from November through March (in aggregate) east of the Mississippi River. Generally, we believe the avenue the cold air will take will be Great Lakes centered, leading to a cold Ohio Valley, Mid Atlantic, New England, and Southeast. The Plains, western Midwest, and Texas falls out of the aggregate cold category, in favor of normal. Warm conditions are confined to the Southwest. This doesn’t mean that areas identified as “normal” or “warm” won’t experience some stretches of cold (or even brutal cold) if the avenue of entry shifts for any particular arctic blast event or events.

Ian Palao VP, Strategic Energy Services

Mr. Palao specializes in commodity risk management and the science of meteorology/climatology. He serves as one of POWWR’s many subject matter experts. He has 20 years of experience in the energy/utility industry, where he used his skills and knowledge of meteorology and advanced statistics.

From 2000 through 2011, he worked at TXU Energy Trading/Luminant Energy in Dallas where he served in three capacities. Most recently, he served as Capital/Liquidity Manager of the trading portfolio, optimizing the use of capital while still maintaining profitability. Prior to that, he managed the Weather Derivatives trading desk, devising strategies and executing trades for both speculative and hedging purposes. Upon joining TXU, he served as manager of the Quantitative Risk Group, assisting the company in the identification, quantification, and remediation of financial risks inherent in the company’s multi-commodity trading portfolio.

In his first foray into energy/utilities, he was a Marketing Executive with Louisiana Gas Service Company, a local distribution company, where he primarily marketed natural gas technology to commercial and industrial customers. Before that, he served as a Research Scientist under contract to the National Oceanic and Atmospheric Administration (NOAA).

Mr. Palao has an M.B.A. from Tulane University. He also has both an MS and BS in Meteorology from Florida State University. He is a member of the Financial Weather and Climate Risk Management Committee of the American Meteorological Society (AMS).