Practical Analytics Chapter 10 | Exercise 2 | Edition 3

10.2
A Forecasting Example Using
Data from NOAA
Nancy Jones, San Diego State University
Nitin Kalé, University of Southern California

OBJECTIVE
Use a Predictive Scenario to forecast climate change.

ACTIVITIES
 Import and prepare data as a Dataset.
 Configure forecasting model in Predictive Scenario.
 Analyze and interpret output from models.

DATA REQUIRED
 TempAnomaly 1900-2021.csv or
o data downloaded from NOAA.gov

Background
Time series analysis is a technique that analysts use to (a) uncover any implicit structure (patterns or
trends) in the data and (b) model that structure to make forecasts. The assumption is that the future, at
least in the short term, will continue the structure of the past. This technique is useful wherever
forecasting values such as inventory quantities, shipping container volume, economic metrics, and traffic
volume is needed.

Global temperatures (along with global climate) have fluctuated over the course of earth’s history.
Climatologists are interested in discovering seasonality, trend and cycles in past data in order to build
models for forecasting future trends. The interplay between earth’s atmosphere, oceans and lands
poses a complex fluid mechanics problem which is governed by the principles of physics. Additionally,
there are factors such as solar insolation, earth’s geology, and volcanic activity. The recent question of
anthropogenic contribution to climate change, although controversial, cannot be ignored and needs
further research.

In this scenario, we will look only at the trend and seasonality from the past century. Instead of using
absolute temperatures, climatologists use Global Temperature Anomaly for analysis.

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Practical Analytics Chapter 10 | Exercise 2 | Edition 3

The term temperature anomaly means a departure from a reference value or long-term average. A
positive anomaly indicates that the observed temperature was warmer than the reference value, while a
negative anomaly indicates that the observed temperature was cooler than the reference value. The
global time series is produced from the Smith and Reynolds blended land and ocean data set (Smith et
al., 2008). This data set consists of monthly average temperature anomalies on a 5° x 5° grid across land
surfaces. These grid boxes are then averaged to provide an average global temperature anomaly. An
area-weighted scheme is used to reflect the reality that the boxes are smaller near the poles and larger
near the equator. Global-average anomalies are calculated on a monthly and annual time scale. The
global and hemispheric anomalies are provided with respect to the period 1901-2000, the 20th century
average.

Scenario
Global temperatures (along with global climate) has fluctuated over the course of earth’s history.
Climatologists are interested in discovering seasonality, trend and cycles in past data in order to build
models for forecasting future trends. We would like to spot some of these trends using time series
analysis.

Step 1: Create a Dataset from the NOAA .csv File

1. Create new Dataset from a CSV or Excel File
a. Select Source File TempAnomaly 1900-2021.csv
b. Import.
c. Give the dataset a name and Save it to your folder.
2. To prepare the data for the forecasting model:
a. Change Year and Month to dimensions.
i. Data Type = String
ii. Statistical Type = Ordinal
b. Change the name of “Value” to Temp Anomaly.
c. To create a data variable, select Month.
i. Create Transformation.
1. Concatenate Month and Year to create a new column Month_Year

Figure 1: Concatenate Month and Year

ii. Change the Month_Year to Data Type Date, Statistical Type Continuous.
iii. Conversion Format = MM/YYYY. These settings are shown below in Figure 2.

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Figure 2: Date Settings

d. Save.

Step 2: Configure the Forecast

1. Go to Predictive Scenarios
a. Select Create New Time Series Forecast

b. Name the scenario and save it to your folder.

c. Ok.
2. The following are the settings for the forecast.
a. Add a description.

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b. Select the Temp Anomaly data set you just created as the Time Series Data Source.
c. Signal = Temp Anomaly
d. Date = Month_Year
e. Number of Forecasts = 12 for 12 months
f. Exclude as Influencers, Year and Month.

Figure 3: Settings for the Forecast

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3. Train & Forecast

You will see the results of the forecast as a line graph. You can change what is shown by using Settings.
You can zero in on areas of interest by drawing a box around them with your mouse and zooming in.

You will also see tables with Forecasts and Signal Outliers.

You can change graphs to tables and tables to graphs.

Figure 4: Example of a Temperature Forecast

On the Explanation page, you will see the signal decomposition from the exponential smoothing. You
can choose which values to show: cycles, actual, forecast, trend, and final residuals. You can also Zoom
in on areas of interest or selects lines or points on the line to examine more closely.

Figure 5: Example of Signal Decomposition

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Practical Analytics Chapter 10 | Exercise 2 | Edition 3

Question 1: Interpret what you see in the time series. What are the visualizations telling us
about global temperatures? Include a screen shot of your forecast to support
your statements.

Question 2: Do you think this forecast is accurate? Why or why not? Use the signal
decomposition visualization and horizon-wide MAPE value to explain your
answer. Include a screen shot of the signal decomposition to support your
statements.

Question 3: Interpret what you see in the time series. What are the visualizations telling us
about global temperatures?

Challenge Activity
Identify a month and year in the forecast that has a signal outlier. Research the weather during that time
period and explain why that year might have been an outlier to the analysis.

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