{"id":9943,"date":"2016-11-03T23:32:49","date_gmt":"2016-11-04T03:32:49","guid":{"rendered":"https:\/\/digital.hbs.edu\/platform-rctom\/submission\/is-climate-change-putting-vail-resorts-on-a-downward-slope\/"},"modified":"2016-11-03T23:32:49","modified_gmt":"2016-11-04T03:32:49","slug":"climate-change-is-it-all-downhill-for-vail-resorts","status":"publish","type":"hck-submission","link":"https:\/\/d3.harvard.edu\/platform-rctom\/submission\/climate-change-is-it-all-downhill-for-vail-resorts\/","title":{"rendered":"Climate Change: Is it All Downhill for Vail Resorts?"},"content":{"rendered":"

Effect of climate change on the snow sports industry<\/strong><\/p>\n

As the snow sports industry continues to struggle through inconsistent winters, resorts are consistently looking for ways to mitigate the effects of climate change.\u00a0 Vail Resorts, the largest publicly owned ski resort operator in North America [1], has been plagued by significantly lower snowfall, specifically in their Tahoe region.\u00a0 Vail Resorts\u2019 California properties have been suffering, receiving only 60% of the average annual snowfall over the 2012-2014 seasons [1].\u00a0 The 2013-2014 season was remarkably low with the resorts averaging only 29% of the usual snowfall, and the future isn\u2019t looking much better [1].\u00a0 According to researchers from Stanford, similar atmospheric conditions to those experienced in the most recent time period are at least three times as likely, due to the human emissions of greenhouse gases [1].\u00a0 The company generates the vast majority of its profit during the winter months and will have to find a way to adapt to remain highly profitable.<\/p>\n

\"dry-chairlift\"<\/a> [2]<\/p>\n

How has Vail Resorts responded?<\/strong><\/p>\n

Vail Resorts, while typically not overly outspoken in regards to climate change, has implemented a number of initiatives related to sustainability in recent history.\u00a0 In 2008, Vail set a target of reducing energy usage by as much as 10% in 2012 and were able to reach that goal in the 2011 season [3].\u00a0 They re-upped on this strategy, committing to an additional 10% reduction by 2020 [3].\u00a0 In the past 5 years, the Vail resort individually has spent more than 3 million dollars on a variety of sustainability initiatives:<\/p>\n

More efficient grooming technology<\/em> \u2013 The company invested in GPS grooming technology in order to maximize the efficiency of the snow cats and decrease idle time and fuel consumption.\u00a0 Snow depth sensors have also been implemented to help the resort minimize excess snowmaking [3].<\/p>\n

New snowmaking compressors<\/em> \u2013 In 2013, a number of old compressors were replaced with a single, higher efficiency compressor, saving the resort 1.2 million kilowatt hours per year [3].<\/p>\n

New technology\/solar energy<\/em> \u2013 Additionally, the resort is experimenting with more efficient ways to power and operate the on-mountain facilities, installing new compressors and solar panels on mountain buildings [3].<\/p>\n

\"groomer\"<\/a> [5]<\/p>\n

Outside of sustainability, the organization has decided to expand its resort portfolio to diversify the risk associated with changing snow patterns.\u00a0 With the weather variability in the Sierra Nevadas over the recent years, Vail Resorts looked to expand its footprint by acquiring Whistler Blackcomb [4].\u00a0 The president of the National Ski Area Association, Michael Berry, stated that in the West, there are three areas of weather: the Rocky Mountains, the Sierra Nevadas, and the Pacific Northwest\/Southwest Canada.\u00a0 Berry continued to say, \u201cThe scenario that all three would suffer the same consequence in one season is not particularly likely, and if it did happen, the ski business would be a footnote in the grander issue\u201d [4]. \u00a0\u00a0The bigger concern is that the diversification, while potentially good for business, fails to address the root cause of the climate change issue.<\/p>\n

In continuing with this trend, Whistler has recently announced a plan to spend $345 million to diversify the attractions it offers [4].\u00a0 The resort is looking to expand its mountain biking options, add new lifts, and build a year round waterpark near the base of the mountain [4].<\/p>\n

Additionally, the industry as a whole has increased snow production dramatically.\u00a0 Vail Resorts specifically have invested heavily in snowmaking equipment to protect itself from the reduced snowfall [1].\u00a0 However, this increase in snowmaking adds a significant energy load and water usage to the company, counteracting some of their previous efforts.\u00a0 Again, this is a short term fix, and with snowmaking already accounting for greater than 50% of energy costs [1], this is not a sustainable solution.<\/p>\n

Going Forward<\/strong><\/p>\n

Vail Resorts has taken a number of steps in the right direction by beginning to place an emphasis on energy reduction and various sustainability issues.\u00a0 The company must continue to look for innovative ways to reduce their energy and diesel usage.\u00a0 They may explore a more efficient chairlift design, more strategic snowmaking, or even attempt to further improve the grooming efficiency of their snowcats.<\/p>\n

Vail may also follow Whistler\u2019s lead at their other mountains and attempt to expand the attractions to all 4 seasons.\u00a0 Potential growth into mountain biking, hiking, or other base area attractions could lead to increased revenue in the off season.<\/p>\n

Finally, they may choose to increase snow production as a short term fix, yet this is will counteract a number of their energy reduction efforts and could ultimately be detrimental in the fight against climate change.<\/p>\n

 <\/p>\n

 <\/p>\n

Words: 759<\/p>\n

 <\/p>\n

 <\/p>\n

Sources<\/strong><\/p>\n

[1] – Bebb, Donna. Climate Exposure Impact on Equity Valuation: Case Study of Vail Resorts, Inc. Stanford Steyer-Taylor Center for Energy Policy and Finance<\/em>. Retrieved November 3, 2016.<\/p>\n

[2] – Bagley, K. (2015, December 24). As Climate Change Imperils Winter, the Ski Industry Frets. Retrieved November 03, 2016, from https:\/\/insideclimatenews.org\/news\/23122015\/climate-change-global-warming-imperils-winter-ski-industry-frets-el-nino<\/p>\n

[3] – Sustainability. Retrieved November 03, 2016, from http:\/\/www.vail.com\/mountain\/environment.aspx<\/p>\n

[4] – Best, A. (2016, August 12). Climate Change a Factor in Vail Resorts Swallowing Whistler. Retrieved November 3, 2016, from http:\/\/mountaintownnews.net\/2016\/08\/12\/climate-change-a-component-of-vail-resorts-swallowing-whistler\/<\/p>\n

[5] – Heavenly Mountain Snowmaking & Grooming. (n.d.). Retrieved November 3, 2016, from http:\/\/www.skiheavenly.com\/the-mountain\/snow-report\/snowmaking-and-grooming.aspx#\/Grooming<\/p>\n

[6] – Mountain Trail Maps. Retrieved November 03, 2016, from http:\/\/www.vail.com\/mountain\/explore-mountain\/mountain-trail-map.aspx<\/p>\n","protected":false},"excerpt":{"rendered":"

As climate change brings variable snowfall, how will Vail Resorts respond?<\/p>\n","protected":false},"author":1893,"featured_media":10052,"comment_status":"open","ping_status":"closed","template":"","categories":[],"class_list":["post-9943","hck-submission","type-hck-submission","status-publish","has-post-thumbnail","hentry"],"connected_submission_link":"https:\/\/d3.harvard.edu\/platform-rctom\/assignment\/climate-change-challenge-2016\/","yoast_head":"\nClimate Change: Is it All Downhill for Vail Resorts? - Technology and Operations Management<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/d3.harvard.edu\/platform-rctom\/submission\/climate-change-is-it-all-downhill-for-vail-resorts\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Climate Change: Is it All Downhill for Vail Resorts? 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