Salient Predictions announces its next generation weather model, GEM 1.0, to help traders, analysts, and portfolio managers better quantify and manage price exposure. Salient’s generative AI model can help you successfully take advantage of market volatility, confidently trade and hedge future contracts based on long term weather forecasts, and reliably predict the actual likelihood of weather events.

According to McKinsey & Company, “the ability to leverage quantitative approaches through traditional AI and AI foundation models is becoming paramount for success.”¹ Having conviction in the likelihood of weather events that can impact load and renewable generation allows you to take more confident short and long positions, no matter what your trading strategy may be.‍

Key Highlights

A Fundamentally Novel Approach

• State-of-the art generative AI model across medium-range and S2S timescales, outperforms publicly available NWP models like NOAA GEFS and ECMWF ENS for native variables and tail/complex weather events.
• Large ensembles deliver uncertainty quantification beyond traditional methods with 200 trajectories (2x more members than comparable dynamical models). The use of large ensemble sizes in data-driven models has emerged as a game-changer by improving robustness to enhance extreme event prediction and reducing uncertainty‍
• Smoothly-evolving probabilities enabling improved quantitative decision making across the entire forecast horizon. Help build confidence in market momentum compared to erratic overconfident models.

Forecast Further

• Skillful ensemble forecasts out to 100 days at daily temporal resolution.
• Available daily at 0800z (3:00 AM EST), earlier than any subseasonal to seasonal numerical weather prediction models.
• Forecasts of variables impacting business decisions including temperature (min, max, mean), CDD, HDD, precipitation, relative humidity, wind speed (10m, 100m), wind direction, max wind gust, solar insolation, cloud cover, wind chill, heat index ,and metrics related to weather regimes such as 500mbar geopotential height and mean sea level pressure.

Actionable, Probabilistic Forecasting

• Multivariate forecasting provides a physically consistent forecast that preserves spatial, temporal, and multi-variable covariance to compute reliable probabilities for complex weather phenomena, such as simultaneous heatwaves and wind droughts in energy-producing regions.‍
• Customized alerts monitor high-impact weather events based on custom intensity thresholds using a probabilistic view of different risk levels so you can gain visibility to market risks and opportunities with longer lead times.

A Measurable Improvement

• Hindcasts enable you to evaluate past forecasts against historical weather data.
• Published skill metrics benchmark Salient’s performance relative to climatology, NOAA, and ECMWF models for full transparency.‍
• Rigorous cross-validation methodology mitigates the risk of overfitting and ensures that model skill is not due to the inclusion of future observations.

Why Does this Matter?

Salient’s reliable and trustworthy forecasts from a data-driven model help forward-thinking organizations gain a competitive edge in weather-sensitive markets. Salient’s team of scientists is at the forefront of this emerging paradigm with the release of the Salient GEM 1.0 model, coming April 7, 2025. Contact us to learn more about how Salient can help you.

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¹From mckinsey.com: How to capture the next S-curve in commodity trading