Plains Pipeline, L.P. submits its Response to the Motion to Intervene and Protest of Valero Marketing and Supply Company under IS12-362.

correspondence and communications concerning this proceeding should be addressed are as follows: Michael L. Jones John E. Kennedy Plains Pipeline, L.P. Elizabeth B. Kohlhausen P. O. Box 4648 Vinson & Elkins L.L.P. Houston, TX 77210-4648 First City Tower 713.646.4335 1001 Fannin Street, Suite 2500 mljones@paalp.com Houston, TX 77002-6760 713.758.2550 jkennedy@velaw.com ekohlhausen@velaw.com II. ANSWER A. Plains Is Entitled to Apply the Commissions 2012 Index Adjustment to its Rates Under Commission Precedent. Plains application of the 2012 Index to its rates is justified under the Commissions well-established standard for evaluating protests to indexing adjustments. The Commissions regulations state that a protest to an index rate filing must allege reasonable grounds for asserting that the rate violates the applicable ceiling level, or that the rate increase is so substantially in excess of the actual cost increases incurred by the carrier that the rate is unjust and unreasonable .4 When determining whether a protest meets the second prong of the Section 343.2(c)(1) standard, the Commission has held that: [t]o maintain the relative simplicity of the oil indexing process, the Commission evaluates a protest to an index-based tariff filing using the data reported in the carriers FERC Form No. 6, page 700 data in a percentage comparison test. The percentage comparison test is a very narrow test that compare[s] the Page 700 cost data contained in the companys annual FERC Form No. 6 to the data that is reflected in the index filing for a given year with the data for [the] prior year . This test is the preliminary screening tool for pipeline [index-based] rate filings, and is the sole means by which the Commission determines whether a protest meets the section 343.2(c)(1) standard.5 4 18 C.F.R. 343.2(c)(1) (2012). 5 SFPP, L.P., 135 FERC 61,274, at P 9 (2011) (footnotes omitted). 2 UNITED STATES OF AMERICA BEFORE THE FEDERAL ENERGY REGULATORY COMMISSION Plains Pipeline, L.P. Docket No. IS12-362-000 Tariff Nos. 74.6.0, 86.2.0, 104.2.0, and 109.2.0 RESPONSE OF PLAINS PIPELINE, L.P. TO MOTION TO INTERVENE AND PROTEST OF VALERO MARKETING AND SUPPLY COMPANY Pursuant to Rule 343.3(b) of the Procedural Rules Applicable to Oil Pipeline Proceedings of the Federal Energy Regulatory Commission (FERC or Commission)1 and Rule 213 of the Procedural Rules of the Commission,2 Plains Pipeline, L.P. (Plains) hereby submits its response to the Motion to Intervene and Protest of Valero Marketing and Supply Company (Valero) filed on June 14, 2012 (Protest). In the Protest, Valero challenges the rate increases that Plains made in Tariff ...