Right from the jump, the title of this poem gives us a very clear notion of the setting. Namely, we're at Coole Park, in Ireland. (Check it out for yourself, why don't ya?) Now, on a biographical note, this place had meaning for W.B. Yeats, which you can read all about over in our "In a Nutshell" section. More than that, though, we like to think that this place has meaning for the poem, too.
Take, for example, the importance of reflection. It's not just the sky that the speaker sees reflected in those still waters. He's come out here, to the natural world, to escape the daily grind of the city (or maybe the suburbs?) and to think about what it all means. Of course, that sort of examination doesn't always yield happy thoughts, particularly in this case as the speaker contemplates his aging and eventual death. All the same, the move to nature to examine the human is one that's been made in poetry since, like, forever.
In the case of this poem, why is the natural world of Coole Park so important? Well, for one thing, it's got swans, which you can read all about in our "Symbols" section. In a broader sense, though, the natural world of the park is one that is basically constant. Trees, sky, water, swans—all of this stuff remains, even as the speaker ages. While he's now nineteen years older than he was when he first visited, he can appreciate—and in a way, envy—the permanence of the park around him. So, the natural energy and permanence of the setting provides a great contrast against which he can think about his weary, aging self.