Reference no: EM131860629

Natural Resource and Energy Economics Problem

The purpose of this problem is to get you familiar with U.S. energy consumption statistics. It will also give you lots of practice with using Excel and making professional looking graphs and analyzing the results. All data for this problem comes from the Energy Information Administration (EIA), the statistical branch of the U.S. Department of Energy (DOE).

Although there are many options available for retrieving the data for the EIA website, please use the interactive data manager page unless noted specifically.

For each of the required graphs, make sure that you label all axes, use appropriate titles, and in general, make sure that your graphs are professional looking (They do not have to be full page to be professional looking - in fact, 4 graphs on one page might look more professional!). You do not have to print them out in color. You may NOT simply cut and paste graphics from the website - you must create your own graphs for this HW.

a) Show energy consumption (Table 1.3) by source for the most recent full year using both a bar or column chart and a pie graph, broken down as follows: coal, natural gas, petroleum, nuclear, hydroelectric, geothermal, solar, wind, and biomass. On the pie chart, note the percentages of each fuel type. (For pie charts, label the wedges instead of using a legend please. Also useful to display percentages on the wedges).

b) What percent of total energy consumption in that year came from fossil fuels? From nuclear? From renewables other than hydropower?

c) Plot energy consumption by source from 1990-present using a bar or column chart. Use the following categories in your chart: coal, natural gas, petroleum, nuclear, and renewables. (Note: only use the most recent data for which the whole year is available).

d) Suppose you had to describe your graph developed in part c to a policy maker. What would you say? (Write a paragraph using your critical analysis skills.)

e) Create ONE graph that clearly shows oil consumption (may be called petroleum products supplied) and oil imports from 1973 to the present. Write a brief summary describing your findings (a few sentences should do).

f) Create ONE graph showing total energy consumption AND per capita energy consumption versus time. The population numbers are found in the appendices (Table C1). (Adding a second vertical axis is an option for many types of Excel graphs- for help, simply type "add a secondary vertical axis" into the Excel help command and it is the first option.)

g) How would you interpret your results in part f to a policy maker. Be very careful - what interesting thing does your graph show?

h) Create one graph of crude oil prices (imported oil prices) from 1970 to present in both real and nominal terms. Interpret your findings.

i) Create one graph of delivered natural gas prices for residences from 1970 to present in both real and nominal terms. Interpret your findings.

j) Create one graph of real oil and natural gas prices from 1970 to present. Depending on the units you select, you may want to use two vertical axes (oil prices on first; natural gas on second.). Comment on anything significant from this graph.