Practice Problem: Passing Gas!

In recent years, the United States has begun to reduce its dependence on foreign energy. Much of this progress is due to the development of hydraulic fracturing technology (fracking) and the consequent major increase in natural gas extraction. While there remain concerns regarding the environmental impact of fracking, it is also a question whether natural gas development (along with changes in energy production and use) will have a significant and lasting effect on U.S. energy imports. A nonprofit energy policy research group has asked your team to develop estimates of the long term effect of current energy market trends on future U.S. dependence on foreign energy.

1. Create a model to forecast natural gas production over the next 10 years. How will the proportion of U.S. energy use powered by natural gas change over that time?
2. Natural gas deposits are concentrated in a few states. High production states may wish to use as much of the gas as possible locally heating homes, producing electricity and powering vehicles.  This would reduce the cost and risk of transporting the gas while passing the benefits of local energy on to state residents. Create a model that determines if it is feasible for a given state to be primarily powered by natural gas and use your model to determine the percentage of the United States that could be powered by natural gas.
3. Citizens have mixed-feelings about the safety and environmental impacts of fracking. Thus, it may not be accepted in some regions of the United States. Create a model that can be used to determine a region’s willingness to pay for natural gas service.

Reference: http://www.eia.gov/naturalgas/

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Problem Author: Dr. Paul Taylor, Shippensburg University

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