For a decade the Colorado ski industry has enjoyed a little-known hedge against the Colorado River drought — a deal with Denver that allows resorts to "borrow” water rights when they are making snow in fall so long as they return the snowmelt to the city’s reservoir in the spring.

But as federal officials demand that the states along the Colorado River basin conserve an additional 2-4 million acre-feet of water amid a 22-year drought, the delicate system is strained by impending water shortages after nearly a quarter-century of drought.

Hydropower plants, municipalities and farmers downstream of the Colorado ski resorts have legal rights to demand more of the river’s total flow. Should they exercise these rights, Colorado’s ski industry would have little recourse — meaning they might be legally bound to let the water flow by rather than turning it into snow.

That possibility has unnerved resort operators, and it has the potential to undermine one of Colorado’s most lucrative industries while also cutting the springtime flow to Denver’s main reservoir, Dillon Reservoir. Industry executives and city officials say this dire scenario is not imminent, but they agree that it highlights one of the many ways the state’s economy and lifestyles were built for a healthy, robust Colorado River that no longer exists — and may not return soon.

“It is likely we will see the reservoirs not being able to fill soon. This is frightening because so many people, including the resorts, rely on the reservoirs to address their water needs. If they stop filling, that throws off the whole system,” said Craig Corona, a Basalt-based water rights attorney.

By putting the ski industry at risk, the drought also threatens Colorado’s $20 billion tourism industry.

Without as much water in the Colorado River Basin, Colorado ski resorts already are seeing a change in snowpack’s quality, quantity, and longevity. While they usually supplement the natural snow with machine-blown powder, those resources, too, are limited by the drought.

Making the problem still more serious is an antiquated system for allocating water rights based not on need or other public priorities but, instead, on which entity made its claim first. That means that Shoshone hydro plant, a Glendale, Colo. dam, has legal rights that supersede those of the ski resorts by decades. If the plant makes a call for more water due to drought conditions, that could put the industry in peril.

“The Senior Shoshone Call, established in 1902, would shut down all snowmaking use,” said Glenn Porzak, a Boulder-based water attorney that has represented many of the major Colorado ski resorts.

Ski resorts as water storage

In 1992, Arapahoe Basin, Copper, Breckenridge, Keystone, and Winter Park bought Clinton’s Gulch reservoir to supply their snowmaking. They then entered into an agreement with Denver: when the resorts are diverting water for snowmaking, Denver would divert water from reservoirs they own to meet downstream flow requirements. In exchange, the ski resorts would divert water for Denver to use in the spring.

“It’s very creative. Now, you have these five ski areas, competitors, cooperating to get their snowmaking water that they wouldn't be able to get on their own,” said Porzak, who represented Summit County as water counsel in the 1992 Clinton Agreement.

So, essentially the resorts function as a water storage system for Front Range cities. They store the water in the winter as snow and give it to Denver and Colorado Springs come spring. This agreement benefits both the ski resorts and the population of Denver.

“The ski areas all have one common denominator: they are upstream of Dillon reservoir,” said Porzak

Eighty percent of water in Colorado falls west of the Rockies, but 80% of the population lives east of the Rockies. The movement of water over, under, and across the mountains is a feat of engineering.

Dillon Reservoir, nestled between Frisco and Silverthorne, is Denver’s primary water source. Unlike William’s Fork Reservoir, where the ski resorts extract water to blow snow, water from Dillon Reservoir can make it across the mountains. A complex trans-mountain diversion brings the water from Dillon’s Reservoir to the eastern slopes. One of the pipes connecting Dillon Reservoir to Denver runs directly below Keystone Resort.

Through this agreement, Denver is trading water it cannot access – for water it can get into Dillon Reservoir through snowmaking.

Through this agreement, the ski resorts have made themselves invaluable to the front range municipalities, therefore buying themselves some time to plan for coming drought years.

Vail and Beaver Creek used a similar strategy. They bought Echo Park Reservoir and made deals with farmers who had older, more powerful water rights: they would help the farmers meet downstream calls in the summer when they need more water if the farmers could do the same for the resorts when they start blowing snow in the fall.

Downstream calls

The Colorado River Compact, a 1922 agreement between the seven Colorado River Basin states governing the allocation of water, was written during a series of wet years. Now, the balance it struck faces a grave threat. Everyone in the basin needs more of the river than it can give.

Because of Western water law’s “first in time, first in right” structure, some entities have more right to the increasingly finite resource than others.

Senior water rights holders exercise that power using calls. It is these calls that threaten the livelihood of the entire Colorado ski industry, some in the ski industry said. 

The Cameo Calls, for example, are a group of Grand Junction water rights located downstream of the Colorado ski resorts. The calls give the owners the right to ask for a certain flow rate from users upstream. This includes the ski resorts.

“We are not feeling the drought severely, we are at the headwaters of the Colorado River. The threat to Aspen/Snowmass is the Cameo Calls, which could restrict all our water,” said Auden Schendler, the senior vice president of sustainability at Aspen/Smowmass.

As the volume of water flowing down the Colorado river decreases, the amount of water that these calls can ask for is a higher percentage of the water that exists in the basin.

“The calls are going to come a lot more frequently, so the flows are going to be much lower for a higher percentage of the time and that will decrease the water that the junior rights can use,” said Corona, the water rights Attorney.

The Cameo Calls water rights date back to 1912 and provide water for Grand Valley irrigation and power. The call trumps all upstream junior users, such as the ski areas.

“This means that upstream diversions, including Front Range reservoirs and direct diversions, must shut down to satisfy senior agricultural needs at Cameo, and upstream reservoirs may need to release additional water into the river to meet the Call,” wrote Chrissy Sloan, legal fellow for Roaring Fork Conservancy.

The Shoshone Call, the “most powerful water right on the Colorado River," according to Sloan, holds similar power over the Summit County ski resorts.

The Shoshone Call allots water for a dam in Glenwood Canyon. Xcel Energy, the Minneapolis-based firm that serves almost 6 million customers across the western United States and is Colorado's largest energy company, owns and uses the hydro plant at the dam to generate electricity by diverting water through a tunnel in the canyon to a plant where it turns turbines. The water is then returned to the river, so the call does not affect downstream users.

For upstream users, the call means that they must provide the water that Xcel requests.

“When the Shoshone Call is placed, water rights with a junior priority are curtailed, providing additional water to Shoshone and generation at the plant,” said Xcel Energy in a statement.

With less water flowing through the Colorado River, the calls will come more often with a larger effect on everyone upstream.

The Front Range cities are also put at risk by these calls because of their reliance on the Colorado ski resorts for water storage and movement.

Although Front Range utilities and Western Slope interests alike have shown interest in buying the hydro plant for its associated water rights, Xcel Energy made it clear in its statement that it is not looking to sell the plant.

The economic impact of a drying river

The 22-year-long drought is forecasted to take a substantial economic toll on the Colorado ski industry if it continues.

“The less snow and water we have in the system, the fewer skiers we have supporting our huge tourism industry,” said Torrey Udall, Protect Our Winters chief of staff.

The drought, by endangering the ski industry, also puts the $22.3 billion tourism industry and local Colorado businesses at risk.

“The bigger impact of shortened seasons is on the communities that we are the business anchors for,” said Schendler.

According to a 2018 economic report that looked at the effects of climate change on the ski industry, there could be over a 30% reduction in winter precipitation in the lower Colorado Basin by the 2080s.

“What we found in the 2018 report is that snow equals money. You can't separate the drought from the macro climate's impact on lifestyles and economies that depend on a healthy snowpack. Water is key in that system,” said Udall.

Colorado ski resorts do have some longer-term natural protection against drought: they are all more than a mile high.

“Colorado ski areas are the most resilient of all ski areas to climate change because of their elevation”, said Keith Musselman, a researcher at UC’s Institute of Arctic and Alpine Research.

Compared to resorts in the Sierra Nevada mountains or the Pacific Northwest, Colorado has the potential to be “a sustainable mecca for the next century, but it is not guaranteed,” said Musselman.

“A lot of the big ski industries don’t plan more than 10 or 15 years, so in that timeline, they are sustainable," he said. "But when you start looking beyond that 35, 45, 55 years out, that’s when climate change has a substantial impact."

Drought increases fire risk for resorts

Besides a dramatic decrease in water availability, the Colorado River drought makes the ski resorts significantly more at risk to wildfires.

“The most immediate impact to our members of the ongoing drought is fire risk and increases in insurance costs due to that risk,” said Melanie Mills, President & CEO of Colorado Ski Country USA.

Musselman, who has witnessed Sierra Nevada ski resorts burn, shares this concern.

“Wildfires are the biggest risk that ski resorts face. It is not the 1 to 2 week change in opening but whether the ski areas are standing next year,” he said.

Due to the length and severity of the drought, the environment’s capacity to adapt to occasional dry years is diminished. With that, the risk of wildfire skyrockets.

What’s next?

Dry years in the Western United States are common. Tree ring data will reveal many phases in history when precipitation has been below average for multiple consecutive years. The current drought differs from past droughts because it is happening in a rapidly warming climate.

“We are in this 20-year drought and part of that is natural variability, but because of greenhouse gas emissions, that drought is a lot more severe than it would have been,” Musselman said.

The ski industry has already had to adapt to a drier climate. Opening dates have been pushed later in the season and resorts have published aggressive sustainability plans.

“In Colorado, we are a high elevation area renowned for its powder. We are now seeing snow conditions that we were more accustomed to in fall and spring persist through the winter,” said Musselman.

The Colorado ski resorts have each pioneered their own sustainability practices to reduce their individual effects on the drought and climate change. Resorts are investing in more efficient snowblowers, toilets and lift power. They are making sustainability education a necessary part of the skiing experience.

“Aspen/Snowmass prioritizes water efficiency because it is part of the ethos of the company,” Schendler said.

“With snowmaking, there are chances to be more efficient. For one, when it's cold, don’t make snow, it isn’t energy efficient,” he said.

Other Colorado ski resorts have their own sustainability practices, principles and goals. For Udall, who identifies as a "scared optimist," this is a source of hope.

“The resorts helping visitors understand the importance of sustainable practices leaves me hopeful that we are on a path that our great grandchildren will enjoy the same experience of skiing that we do,” he said.