A method for solar forecasting includes receiving a plurality of solar energy data as a function of time of day at a first time, forecasting from the solar energy data a mode, where the mode is a sunny day, a cloudy day, or an overcast day, and the forecast predicts the mode for a next solar energy datum, receiving the next solar energy datum, updating a probability distribution function (pdf) of the next solar energy datum given the mode, updating a pdf of the mode for the next solar energy datum from the updated pdf of the new solar energy datum given the mode, forecasting a plurality of future unobserved solar energy data from the updated pdf of the mode, where the plurality of future unobserved solar energy data and the plurality of solar energy data have a Gaussian distribution for a given mode determined from training data.