Growing uncertainty around water supply in Northwest Colorado’s headwaters counties—Eagle, Grand, Gunnison, Pitkin, Routt, and Summit—is driving significant economic concerns for communities that depend on water for population growth, outdoor recreation, tourism, and agriculture.
A new report from the Northwest Colorado Council of Governments Water Quality/Quantity Committee illustrates the critical links between economic activity, water resources, and emerging threats in these counties, which are the source of major tributaries, including the Colorado River that delivers water to over 40 million downstream users. The report serves as an update to a 2012 edition, with its findings underscored by recent dire water conditions.
The 2025/26 winter saw a record-low snowpack, followed by intense heat, particularly in March, which led to streamflows peaking early and at record-low levels. Drought conditions intensified across much of the northwest in late spring and early summer, raising alarms for recreational users, businesses, municipalities, and agricultural producers regarding water supply.
According to Kristin Green, the committee's director, “When reservoirs and streams are depleted, local communities suffer acute consequences, especially when peak flows and snowpack are out of sync with vacation and holiday seasons.” Green added that a robust headwaters economy benefits all of Colorado and is impacted by water users across the state, suggesting water operations should alleviate environmental degradation and maximize recreational flows in these counties.
Stakeholders’ primary concerns, as detailed in the report, include water quantity, water quality, water system health, timing of runoff, where water flows or is stored, and temperature. Many of these worries are linked to climate change and transmountain diversions, which carry water from the headwaters counties east to the Front Range.
There are 16 transmountain diversion projects currently operating in the six counties, with others in development or under consideration. These diversions can consume up to 62% of flows in subbasins during an average year and up to 80% in a drought year. The largest diversions originate from the Colorado River below Windy Gap Reservoir outside Granby. A technical report submitted to the council by Lotic Hydrological indicates that transmountain diversions remove approximately 500,000 acre-feet from the Colorado River basin annually. Colorado’s 2023 Water Plan estimates one acre-foot of water can support two families of four or five people for a year.
Beyond supply concerns, the report emphasizes that these diversions can cause environmental damage, including increased pollutant concentrations, loss of natural river flows and peaks, higher water temperatures, and indirect impacts such such as loss of wildlife habitat, declines in tourism, reduced ability to treat wastewater, and broader regional economic effects. The study concludes that water resources from the Headwaters Counties are “neither consistent nor unlimited” and face “considerable future uncertainty” due to ongoing climate change trends.
Data from Colorado State University’s Climate Center, cited in the report, compares 2000-2023 to the preceding 49 years, showing climate change has decreased spring snowpack by 3-23%, resulted in earlier spring runoffs, lowered streamflows by 3-19%, led to a decline in summer soil moisture, and increased evaporative demand by about 5%. The report projects that these impacts on temperature, precipitation, snow-water equivalent, runoff, streamflows, and soil moisture will persist in the coming decades, creating ripple effects across Northwest Colorado’s largest economic sectors.
The report describes the economic prospects for these six counties as “bright, as long as there are adequate water supplies to sustain them.” It states that all economic sectors contributing to the well-being of the headwaters counties depend heavily on water, making the challenge one of maintaining current activity levels, let alone meeting higher ones.
Between 2010 and 2023, the population of these six counties grew by approximately 9,000 people, or 6%, with Gunnison, Summit, and Grand counties experiencing the fastest growth. This growth is projected to continue, with populations anticipated to increase by an additional 20% by 2050. These counties also manage a significant number of second homeowners, accounting for about 40% of the region’s dwellings, and a rising tourist population, estimated at 17.8 million visitors in 2024, with Eagle County alone seeing 5.5 million.
Recreation and tourism are major economic drivers, alongside agriculture, extractive industries (coal, oil, gas, mining), and hydropower generation. All are described as “highly water-dependent.” Water-driven outdoor recreation in the Colorado, Gunnison, and Yampa-White-Green river basins drew around 2.1 million participants in 2020. These activities generated over $2.8 billion in gross domestic product, more than 35,800 jobs, $1.7 billion in wages, and $272.4 million in state and local taxes, according to the report.
The report emphasizes that these recreational activities are “extremely dependent on water supplies arriving at the “right volume, place, time, temperature and quality.” The snowsports industry, a primary economic stimulus for these counties in winter, highlights this vulnerability. Colorado reported nearly a quarter of the country’s ski visitor days in 2024. The ski industry generated about $4.85 billion and 51,000 jobs in the 2022-2023 season, according to a study by RRC Associates, with Summit County’s skiing economic impact estimated at $1.2 billion in 2022 by a Gitnux report.
The past winter’s record-low snowpack demonstrated how hydrological and climate changes can lead to closed ski runs, reduced employee hours and expenditures, and shorter seasons. Future climate models predict hotter conditions in Colorado, meaning that while winter precipitation may increase (7% more at Vail Mountain by 2050 compared to 1970-1999), it is more likely to fall as rain rather than snow. With peak snowpack and snowmelt expected to shift weeks earlier by 2050, the report states that ski resorts’ opening and closing dates will be less certain, and seasons will likely shorten, threatening entire ski town economies. Facing this uncertainty, ski resorts are increasingly relying on snowmaking, thus consuming more water. Many resorts, including Winter Park, Granby Ranch, Copper Mountain, Arapahoe Basin, Keystone Resort, and Vail, have completed or are planning expansions to address changing and uncertain hydrology.
