Energy

At least 15 years ago, the United States and the world entered into an energy famine which is expected to last until advanced energy sources such as fission breeders, fusion, and solar conversion all become implemented on a large scale. The only fuels that can be utilized to carry the world into this time period are coal, natural uranium, and whatever remains of our liquid and gaseous fossil fuel resources which took hundreds of millions of years to form. Since there are both real and perceived problems with the utilization of each of these fuels, energy conservation also must play a major role.

The ski industry, like all productive or recreational enterprises, will be forced to take measures to contribute to the solution of the energy famine—there is no escape and the impact will be sooner than later. The energy intensiveness of the skiing industry is recognized and manifests itself in two energy consumption areas: transportation of skiers to and from the ski area and operation of the ski area itself. Unfortunately, while ski area management can exercise limited control over the latter, the former is relatively independent of management discretion. Fortunately, transportation also is a matter of national policy and measures are expected to be taken to benefit the nation as a whole.

The Transportation Problem

Ski areas, almost by definition, are commercial enterprises located remotely from high population density urban environments. Recreationalists are forced to utilize whatever means of transportation is avalable to them to travel to and from their area(s) of choice. At this time, the method of choice in descending order of use are: personal automobile, bus, aircraft, and train. Of the four, the only two of immediate concern to ski area management are the personal automobile and bus. Trains and airplanes cannot and will not supply the door-to-door service required by the recreationalist.

In the foreseeable future, automotive and bus transportation will be based on petroleum-consuming internal combustion engines and will be seriously affected by the availability of fuel. Setting aside the possibility of embargo (which could cut off at least 30 per cent of supplies), the only reasonable expectation is that the price of fuel will rise, thus putting strain on the financial resources of the purchaser. Although elasticity (fall in demand/use as price rises) has yet to be demonstrated for gasoline purchases, it is almost certain that the time is nearing. The prospects of rising fuel price would be expected to have the following near term effects in the ski area industry:

1. Fewer trips by the recreationalist, thus decreasing the receipts of ski areas.
2. Shorter trips by the recreationalist, thus penalizing remote areas and favoring close-in areas.
3. Increased use of bus mass transit, thus putting pressure on local accomodations (remote areas).

The possible dominance of any of these alternatives is not easy to predict, however, it is fair to say that probably they all will operate in a mix determined by the economic complexion of the region served by ski areas.

The longer term, say the mid-to-late 1980’s, is even more uncertain. We in the energy community feel that private motor vehicles still will be a major element in transportation, but at a significantly higher fuel efficiency. While this may serve to extend the use of the automobile by the recreationalist, there may be other cost factors in place to deter its use. It is safe to say that bus transportation in this time-frame will enjoy a significant cost advantage over the private automobile and therefore, will have high utility.

So far, I have described an orderly economic and political approach to the transportation problem of the ski area industry. Again, setting aside the possibility of an oil embargo, consider what may become real as a result of an emerging energy policy. It is a fact that the major emphasis of the current administration is conservation with expansion of the near-term fuel supply being almost equally as important. It also is a fact that one of our major energy supplies, natural gas, is a dwindling resource in the current regulatory climate. Finally, our only national fossil resource is coal which is not a readily substitutable fuel. These three findings suggest that the administration will be forced to take the following measures, probably within the half-year:

1. Compel industry to return to the use of coal and oil rather than natural gas to relieve the pressure on residential and non-substitutable customers.
2. Require that oil suppliers operate their refineries to provide the expected increased heating oil demand next winter.
3. (Possible) Take steps to assure that gasoline demand will be low enough so that the second measure can be taken.

If this scenario should come to pass, and there is a reasonable chance that it can, then it is very likely that gasoline supplies next winter are going to be painfully short. The rate at which these measures are implemented will determine the extent to which gasoline may be in short supply, but it may be 1978 before the impact becomes significant.

How will the shortage of gasoline be distributed in the marketplace? It’s anybody’s guess, but the alternatives all bode poorly for the ski-area industry:

1. Uniform gas rationing by the government—the impact of this alternative is uncertain except that bus transit would increase, one-day trips would decrease, and long trips would be all but eliminated.
2. Gas-less Sundays—this would have an impact on the ski-area industry similar to the first point. However, this is a very unpopular alternative in the minds of American citizens.
3. Free market effects—the laws of supply and demand would be allowed to operate. Gasoline would be available, but at higher cost.
4. Government imposed incremental pricing—gas would be available but at increasing price with individual consumption. Although very cumbersome to implement, this would be the fairest system to use as it permits the consumer to choose how to spend his discretionary income.

With these alternatives, it seems evident that the ski industry will be adversely impacted by the deepening energy famine and the natural question is how to minimize the effects of the situation. First, it appears that little can be gained by lobbying for “fair treatment” in any allocation scheme. The situation is so grim that even the most hardened bureaucrat or politician will be forced to admit that open factories and schools have priority over recreational activities. One only could hope for public assistance to implement methods to relieve the impact of severely curtailed recreational transportation. This should be the policy of choice in the NSAA.

Second, ski area management should become active in mass transportation utilization. This may involve political lobbying, contracts with existing companies, or even becoming an element in this transportation alternative. As a ski area manager, I would be very interested in negotiating an agreement with a local urban bus company.

Last, in response to dependency on mass transportation, provisions should be made to accommodate the skiing recreationalist when he or she has been delivered to the ski area. This may involve the expansion of existing living facilities, local transportation, and the like.

The Operational Problem(s)

Conservation also will affect the policies with which ski areas are operated. Of the four major energy use operations — snow making, running lifts, heating buildings and running grooming equipment — the first two are of primary concern. Fortunately, cold weather of long duration, of the type that gave rise to the nation’s most recent energy crisis, also should place less of a burden on snowmaking provided that ski area operators use good judgment in its use. The operating of lifts will not be so affected as they are assumed to run almost irrespective of snow conditions (there being only two types of skiing—good skiing and no skiing).

The major problem will be the justification for the use of snowmaking equipment in an environment of factory closings caused by insufficient fuel supply. This is not particularly tractable to solution because even the best arguments will fail in the face of public opinion. However, there are two elements of this problem that deserve discussion.

First, in response to the emphasis on conservation, ski area managements should streamline energy consumption patterns to optimize efficiency. They should also use energy resources that are most abundant in the region. For example, electric power may be the energy supply of choice in the near to middle term even though demand charges are now high and will probably remain so. The decision to rely on electric power would be based on substantial regional reserve capacity of either coal or uranium fueled plants, coupled with the possibility that liquid and gas fossil fuels simply will not be made available to ski areas because of short supply. Therefore, the choice could be between running but at a higher cost and not running at all. Management must be alert to this fact and be prepared to meet with regional energy producers to select the best energy sources.

The second element is the preparation of the defense that, after all, ski areas are an industry, that they are employers and deserve no less equitable treatment than any other industry. While it may be argued that the skiing industry is not productive in the normal sense, it has tangible benefits to skiing recreationalists who in turn are more productive because of their choice of leisure time. It must be made quite clear that all industry is in place for the benefit of the ultimate consumer and it is (not yet) within the franchise of government to determine consumer preferences (setting aside issues relating to consumer product safety).

Conclusions

It is clear that the ski area industry will be adversely affected by the continuing energy famine. Management now must prepare for this situation by implementing policies that will optimize the efficiency of the skiing recreation experiences. In terms of transportation, involvement in mass transit is timely. For the ski area itself, selection of the most abundant regional energy supply is important as well as optimizing the efficiency of use of this supply. Finally, the NSAA should start to develop a position that skiing is, after all, an industry and is important to the productivity of the skiing recreationalist.

Locke Bogart, when he is not working on the nation’s energy problems as a specialist at the Energy Research and Development Administration in Washingtron, is likely to be found patrolling the slopes as a Senior NSPS Patrolman.