Yes, you can cancel the reservation thru Airbnb as an extenuating circumstance, but I'd contact the guests first to let them know the situation. Some guests can be understanding of a situation beyond your control, and it may be more preferable to them than having their booking cancelled and finding they have nowhere to stay.
Not really because it's hot and the travellers are prefering not to change their reservation ; and for them ther's no problem with only cold water ; I always send a message to tell with this problem