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Heating Degree Day

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Heating Degree Day
A day on which the temperature in a certain area is below 65 degrees Fahrenheit, necessitating the use of heaters. Heating degree days are used in some weather futures, which are contracts in which the buyer is required to pay the seller some multiple of $20 for each heating degree day in a month, depending on how much cooler it is. Weather futures allow businesses to hedge against potential losses resulting from unexpected changes in weather. Energy companies are the most common sellers of weather futures; they have become relatively popular investments. See also: Cooling degree day.


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Under the agreement, the United States is divided into three regions: (1) the north, composed of states with population-weighted heating degree days (HDD) equal to or greater than 5,000; (2) the south, composed of states with population-weighted HDD less than 5,000; and the southwest, comprised of Arizona, California, Nevada, and New Mexico.
Add the heating degree days and cooling degree days, as Sivak’s study does, and you get an idea of how much energy is used year-round in the region.
Environment Canada lists the average degree days for Ottawa (1971-2000) as 4602 Celsius heating degree days <18[degrees]C (8284 Fahrenheit heating degree days <64[degrees]F) and 244 Celsius cooling degree days >18[degrees]C (439 Fahrenheit cooling degree days >64[degrees]F).
 
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