Forecasting generally consists of statistical and simulation modeling techniques that are used to develop long-term projections of future supply relative to future demand. Many utilities forecast water supply and water demand for 50 to 80 year periods. Forecasting can be used to develop flood-and-drought warning systems, to make predictions and projections for seasonal variability in precipitation, and for modeling future climate variability.

Climate change presents a clear challenge to forecasting. Since many forecast techniques rely on historical climate data, changes to baseline conditions as a result of climate change can reduce the predictive value of historical data in determining future conditions. However, a good first step in adapting to climate change is improving management to meet current climate variability by using seasonal forecasts to inform decision making in lieu of annual or ‘average’ year forecasts. This will improve utility flexibility and leave resource managers better prepared to face future climate change impacts.