The Australian Actuaries Climate Index has recorded the lowest composite index value since Winter 2020.
The latest Australian Actuaries Climate Index (AACI), which covers the Summer of 2022/23, has recorded the lowest composite index value since Winter 2020. The results were primarily driven by the extreme high temperature and extreme rainfall components, which were both below the reference period average in most of the country.
The Index measures the frequency of extreme weather conditions and sea levels across Australia compared to the reference period of 1981-2010 and how these vary over time.
Extreme high temperatures below reference period average for most of the country
The extreme high temperature index was negative for all parts of Australia except for Tasmania and the Southern and South Western Flatlands (East). This means that there were fewer days with extreme high temperatures in the summer of 2022/23 compared to the reference period average.
Similarly, the Bureau of Meteorology observed warmer than average temperatures in SA and TAS, but cooler than average temperatures in most of the rest of the country. The month of December was particularly cool.
Rainfall results illustrate the difference between averages and extremes
The extreme rainfall index was negative for all parts of the country except for the Monsoonal North and Wet Tropics regions, which cover the most northern parts of the country. That is, in all regions except the Monsoonal North and Wet Tropics there were fewer days with extreme rainfall this summer compared to the historical average in the reference period. However, the Bureau of Meteorology noted that summer rainfall was 27% above average for Australia as a whole.
This illustrates the difference between average and extreme measurements. The index is intended to measure changes in frequency of extreme weather, which is more relevant in an insurance context.
The positive index values in the northern parts of the country were experienced as flooding in the Victoria Daly Region in NT after persistent heavy rain caused rivers to overflow. Note that this event began at the end of February but culminated in the first days of March, which are not included in the index values for this season.
Maximum sea level continues to be elevated
Australia observed the 28th consecutive positive sea level index value. No records were set, but all clusters showed above reference period average maximum sea levels. This was particularly high in the Monsoonal North cluster, which covers northern parts of Queensland.
The El Niño-Southern Oscillation weather system transitioned from La Niña into an El Niño watch phase at the beginning of March.
This means that while the system is currently in a neutral phase, it is about twice as likely as usual that El Niño develop later in 2023. El Niño typically suppresses rainfall in eastern Australia and can contribute to conditions that make droughts and bushfires more likely.
The Index was launched in November 2018 by the Actuaries Institute and is updated four times a year by Finity Consulting. It covers extreme high and low temperatures, extreme rainfall, consecutive dry days, extreme wind and sea level.
Unlike many other measures, the Climate Index focuses on changes in the extremes. This is a more relevant metric for the insurance industry than averages, as it correlates more closely with damage. This is done by measuring how often we observe exceedances of the 99th percentile of the reference period of 1981-2010. More details and full results can be found on the microsite.
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