Texas Gas Service Company
a Division of ONOEK, Inc.
v.
El Paso Natural Gas Company
Docket No. RP10-951
Prepared Answering Testimony of
Suzanne Norquist
Exhibit No. EPG-6
Docket No. RP10-951-000
SUMMARY OF PREPARED ANSWERING TESTIMONY
OF SUZANNE NORQUIST
Dr. Suzanne Norquist, a Principal Rates Analyst in the Rates Department for the El Paso
Corporations pipelines, including El Paso Natural Gas Company (EPNG), submits answering
testimony (Exhibit No. EPG-6) on behalf of EPNG responding to the testimony of Mr. Feingold
for Texas Gas Service Company and Mr. Ekzarkhov for Commission Staff. Dr. Norquist
demonstrates that the physical or so-called actual miles of haul proposed by Mr. Feingold and
Mr. Ekzarkhov are fatally deficient as applied to EPNGs fuel costs, and thus are not reasonable
alternatives to EPNGs existing postage-stamp fuel rate design.
Dr. Norquist explains that Messrs. Feingold and Ekzarkhovs initial reliance on contract
paths as a starting point for estimating actual flow mileage is inappropriate given that contract
data is generally not a good proxy for variable daily operating conditions that are important in
considering how to design rates for a significant variable cost like fuel. Dr. Norquist further
details how Messrs. Feingold and Ekzarkhov then employ complex sets of highly subjective and
erroneous assumptions to revise individual contract receipt/delivery/path mileage numbers to
determine what they characterize as the actual miles of haul for gas flow on the EPNG system.
Messrs. Feingold and Ekzarkhov claim certain contract paths on the EPNG system are
unsupportable or impossible. For these unsupportable or impossible contract paths,
Messrs. Feingold and Ekzarkhov develop adjusted mileage amounts that purportedly represent
physical flow of gas on the EPNG system, by either assuming a new path and/or receipt point or
by deriving various proxies or subjective adjustment factors for purported mileage. Dr.
Norquist describes how Messrs. Feingold and Ekzarkhovs adjusted paths are not representative
of actual, physical gas flows and are, therefore, not accurate measures of distance of haul on the
EPNG system. In addition, Dr. Norquist explains that when Messrs. Feingold and Ekzarkhov
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Docket No. RP10-951-000
identify unsupportable and impossible paths and reassign them (generally to a shorter path)
in allocating fuel costs, they are disproportionately assigning the benefits of displacement to
particular shippers or zones, including the Texas zone, instead of to all shippers who make the
displacement possible.
Dr. Norquist also notes that while Messrs. Feingold and ...
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