As hurricane sandy reminded us recently, weather events can wreak havoc on the best laid plans and trading strategies. It also highlighted the importance of integrating weather forecasts and models into risk, trading and operational plans. I recently had the opportunity to get a glimpse first hand into the significance and limitations of these forecasts.

MDA Weather Services had their 11th Annual Conference for Analysts and Traders, in Las Vegas, last month. The event was sponsored by ZE. Besides learning what the upcoming heating season has in store, attendees got a chance to hear expert speakers, from a power load and generation perspective, with PJM and TESLA. There was also a panel on trading weather risk. Dr. James Duncan, from ConocoPhillips, is typically a crowd pleaser with his energy market outlook focused on the future of natural gas. Attendees had a great time networking over cocktails at receptions as well as enjoying a round of golf and attending a Cirque Show.

As recent events in the Northeast demonstrate, weather data is an integral part of the energy and commodities business and more people should make the effort to attend these events and gain a better understanding of the potential impact of the weather on this business.