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Conventional deep learning models often struggle with treatment effect estimation in climate settings due to time-varying confounding and the lack of physical constraints. To address these challenges, we propose the Knowledge-Guided Causal Model Variational Autoencoder (KGCM-VAE) to quantify the effect of SSH on sea ice thickness. The framework leverages established physical relationships between SSH and surface velocity to generate physically grounded, time-varying continuous treatments, where each treatment value can change at every time step within a sequence. The model also incorporates Maximum Mean Discrepancy (MMD) to balance treated and control distributions in the latent space, mitigating observed confounding bias. 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