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Cost-Weighted Service Loss (CWSL)

Cost-Weighted Service Loss (CWSL) is a core evaluation metric in the Electric Barometer framework. It is designed to measure forecasting system behavior under asymmetric cost, where different error directions incur different operational consequences.

CWSL provides a cost-aligned view of forecast error that complements traditional accuracy metrics and supports governed, decision-aware evaluation.

Why CWSL exists

Most common accuracy metrics treat forecast errors as symmetric and interchangeable. In operational environments, this assumption rarely holds.

CWSL exists to:

  • Make asymmetric cost explicit
  • Preserve information about error direction
  • Surface operational risk that symmetric metrics obscure
  • Support evaluation under clearly stated assumptions

CWSL is a measurement tool, not a decision rule. It informs decisioning without replacing policy or governance.

For conceptual grounding, see Asymmetric Cost and Evaluation vs Decisioning.

What CWSL measures

At a high level, CWSL measures:

  • Forecast error magnitude
  • Weighted by the direction of the error
  • Aggregated across a defined evaluation scope

The resulting value represents expected loss under explicit cost-weighting assumptions.

CWSL does not assume universal cost ratios. All weighting choices are contextual and must be made explicitly.

How to navigate the CWSL documentation

The CWSL documentation is organized by intent:

  • Definition Formal definition of CWSL, including structure, scope, and encoded assumptions.

  • Interpretation Guidance on how to read and compare CWSL values responsibly.

  • Examples Illustrative scenarios demonstrating how CWSL behaves under different conditions.

  • Assumptions Detailed discussion of the assumptions CWSL encodes and their implications.

Each page focuses on a distinct aspect of understanding CWSL. Together, they form a complete, non-overlapping explanation.

What CWSL is not

CWSL does not:

  • Select forecasting systems
  • Encode organizational policy
  • Resolve tradeoffs automatically
  • Guarantee operational readiness
  • Replace governance or decision logic

Those responsibilities belong to readiness, policy tuning, and decisioning layers.

See Readiness and RAL and Tune a Policy for how CWSL outputs are used downstream.

How CWSL fits into the Electric Barometer lifecycle

Within the Electric Barometer framework:

  • Forecasting systems generate candidate outputs
  • CWSL measures cost-aligned error behavior
  • Evaluation compares systems under explicit assumptions
  • Readiness contextualizes evaluation results
  • Policy tuning defines how tradeoffs are resolved
  • Decisioning applies governed rules
  • Releases preserve reproducibility

CWSL is foundational, but not exclusive. It exemplifies how Electric Barometer treats metrics as explicit, interpretable lenses rather than opaque scores.

When to use CWSL

CWSL is appropriate when:

  • Error direction has unequal consequences
  • Operational risk matters more than average accuracy
  • Evaluation must reflect cost asymmetry explicitly
  • Tradeoffs between stability and responsiveness are relevant

In contexts where errors are truly symmetric and consequences are minimal, simpler metrics may suffice.

Where to go next

  • Start with Definition if you are new to CWSL
  • Read Interpretation to understand how to compare results
  • Explore Examples to build intuition
  • Review Assumptions to understand what CWSL encodes
  • See Metrics for other evaluation lenses
  • Consult Papers for formal mathematical treatments

CWSL is the reference metric for asymmetric cost in Electric Barometer. It demonstrates how evaluation can be made explicit, interpretable, and aligned with real-world operational risk.