Abstract
The weather derivatives market as an instrument of effective weather risk management is still not flexible enough for many industries. The water supply and sewerage industry is sensitive primarily to heavy rainfalls and periods of high and low temperatures: days with heavy rainfall may cause a hydraulic overload of the sewerage systems; on hot days, the water demand increases significantly; on frost days, the risk of water pipe failure grows. The work aimed to summarise methods of weather risk management and propose indices that will help to protect the interests of the water supply and sewerage industry in Poland. Three indices were proposed: a daily precipitation index, frost day index, and hot day index. The frequency of reaching these indices in Poland was verified with the use of meteorological data from 1970–2019, for 19 locations. The non-parametric Mann-Kendall test was used to determine the climate change impact on the exceedance frequency of the proposed indicators. The results showed that the indexes were exceeded in the past once every 6 years, on average. The hot day index was exceeded the least often, but it was the only one with a clear (growing) trend observed.
Highlights
In 1971, 1973, and 1986, the daily precipitation index was reached at none of the analysed locations
The highest average of the maximum daily precipitation amounts was recorded in 2010, being no fewer than 47.3 mm, and the daily precipitation index was reached at eight locations
The paper summarises the current state of knowledge about weather risk management and proposes new weather indices for municipal companies as entities that are sensitive to weather conditions
Summary
The most frequently mentioned industries directly dependent on the weather conditions are energy [6,7], construction [8,9], tourism [10], agriculture [11], transport [12,13,14], retail [15,16], and municipal enterprises [17]. In this case, the risk relates to production or production capacity losses occurring as a result of weather phenomena [18,19]. Price changes are secondary in reference to the primary effects of weather phenomena
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