The "degree-day" is a way of estimating the energy used by a heating or cooling system,
averaged over an entire year. For any locality, the National Weather Service reports the
number of "degree-days" to date for the day, month, year and season (heating or cooling
season). What does it mean?

Think of degree-days in the same way that we think of the "year-to-date" rainfall. The number
of degree-days "year-to-date" is a rough measure of the running total of time that your furnace has been on. The more degree-days in your locality, the harder your heating (cooling) system has to work. From physics, we know that the furnace has to supply more heat energy if the outside temperature is much lower than the inside temperature.

Energy consumed by furnace (required to heat house) = constant x (average Tin-Tout)

For each day, add to the running total "degree-days" the number D:

                    D = 65-Tav (assumes the furnace on if Tav < 65)

Tav = the average temperature in a 24 hour period, roughly (Max Temp + Min Temp)/2.
If the result of (D-Tav) is less than zero, make it zero. In this case, the furnace does not come on (and you might have a "cooling" degree-day).

Example for one week (Fahrenheit): cool at beginning and end, sunny Wed-Fri.

Day                         Min Temp         Max Temp         Avg         deg-days
Monday                     45                     55                     50             15
Tuesday                     50                     60                     55             10
Wednesday                55                     65                     60               5
Thursday                    60                    70                     65                0
Friday                         65                    75                     70                0
Saturday                     55                     65                     60               5
Sunday                       50                     60                     55              10

Total degree-days for this week: 45

The furnace did not come on Thursday and Friday.
The average temperature for the entire week is:

(50+55+60+65+70+60+55)/7 = 59.3 degrees F

If the temperature were 59.3 degrees night and day for a week, the furnace would
be on all the time and would be working less hard (against a smaller average
Tin-Tout), but the furnace would consume the about the same amount of energy
if the average temperature were 59.3 degrees night and day for a week.

Note: 7*(65-59.7) gives 40 degree-days, because the calculations are a bit different.
In the first method, you ignore all days in which the temperature is greater than 65, but
in the second method, they do contribute to the average temperature.

The same works for "cooling" degree days, except that you figure:

Add to the running total cooling degree days    (Tav - 65), if Tav>65.

The AC doesn't come on unless the average temperature exceeds 65 F