With the increasing share of volatile renewable energies, weather prediction becomes more important to electricity … markets. The weather-driven uncertainty of renewable forecast errors could have price increasing impacts. This research sets … weather types and their renewable production uncertainty is proved via empirical methods. Weather types are identified in …

. The weather derivative market is therefore incomplete. This paper implements a pricing methodology for weather derivatives …Weather influences our daily lives and choices and has an enormous impact on cooperate revenues and earnings. Weather … derivatives differ from most derivatives in that the underlying weather cannot be traded and their market is relatively illiquid …

In usual pricing approaches for weather derivatives, forward-looking information such as meteorological weather … forecasts is not considered. Thus, important knowledge used by market participants is ignored in theory. By extending a standard … model for the daily temperature, this paper allows the incorporation of meteorological forecasts in the framework of weather …

interesting for investors and issuers of weather contracts to take advantages of geographic diversification, hedging effects and …Forecasting based pricing of Weather Derivatives (WDs) is a new approach in valuation of contingent claims on … nontradable underlyings. Standard techniques are based on historical weather data. Forward-looking information such as …

Due to dependency of energy demand on temperature, weather derivatives enable the effective hedging of temperature … related fluctuations. However, temperature varies in space and time and therefore the contingent weather derivatives also vary …. The spatial derivative price distribution involves a risk premium. We examine functional principal components of …

On the temperature derivative market, modeling temperature volatility is an important issue for pricing and hedging. In … accurate fitting procedure of localised temperature risk process by achieving excellent normal risk factors. -- Weather …