energy. Philip R. Littlejohn Vice President, Regulatory Affairs West Texas Division

Transcription

1 energy. Philip R. Littlejohn Vice President, Regulatory Affairs West Texas Division April!, 219 Geoffrey Gay Lloyd Gosselink Rochelle & Townsend, P.C. 816 Congress A venue Suite 19 Austin, Texas 7871 Re: Atmos Energy Corporation's WEST TEXAS 219 Rate Review Mechanism Filing Dear Mr. Gay, Enclosed for filing is Atmos Energy Corporation, West Texas Division's ("Atmos" or "the Company") second filing under this Rate Review Mechanism tariff. Per our agreement, service is being provided to you in lieu of service to the individual West Texas member cities. We are providing one printed copy along with one flash drive for the West Texas group. A flash drive has been sent directly to each of your consultants. A one page Executive Summary will be sent to the West Texas member cities to notify them of this filing. If any of the West Texas member cities desire additional printed copies, please let me know. If any further information is required, please contact me at Sincerely, Enclosures: RRM Filing Package (1 copy) Flash Drive (1) Atmos Energy Corporation lh Street, Lubbock, TX P pjlil.in.li!!ldilluj_(i/iatmosencrgy.com

2 Atmos Energy Corporation- West Texas Cities Division Executive Summary 219 RRM Filing Aprill, 219 >- Since 29, Atmos Energy Corporation- West Texas Division has submitted a filing to the City Coalition ("Cities") under the Rate Review Mechanism ("RRM"), which is a systematic process specifying how rates will be set over a specified period oftime. >- According to state law, natural gas companies may recover reasonable and necessary costs and earn a reasonable return through the rates charged to customers. >- Based on decades oflegal precedent, the RRM process: o Provides full transparency and allows Cities to closely examine our spending every year, keeping us accountable; o Defines ratemaking principles, cost exclusions for rate recovery and rate design limitations; o Avoids unnecessary and repetitive litigation, which would result in additional costs ultimately absorbed by customers; o Gives the Company a predictable regulatory environment, which is necessary to attract capital to be invested in system replacement. >- Atmos Energy submitted the RRM filing on April 1st : o Includes a requested increase in annual revenue of approximately 6.2 million for the months ending December 31, 218. o Supports investment of over 11 million of total capital investment made in the West Texas system with over 88 million spent on improving system safety and reliability. o Includes a listing of all projects completed within the test year. >- The above efforts have allowed Atmos Energy to replace a significant portion of our infrastructure. Below is what has been accomplished within the West Texas Division. West Texas Division From 211 through 217 o o o Within Calendar Year 218 o 566 miles of distribution pipe replaced o miles of distribution pipe replaced 41 miles of bare steel 99 miles ofbare steel 165 miles of vintage plastic 21 miles of vintage plastic o 22,45 steel service lines replaced o Over 4,896 steel service lines replaced >- Atmos Energy customers under the RRM tariff will see the following changes to their bill: o The average residential customer using 49.8 cubic feet of gas (Ccf) per month will see an increase of 3.28/month, an overall increase of7.58%. o The average commercial customer using Ccfper month will see an increase of 9.59 /month, an overall increase of 6.4%. o The average industrial customer using 3,499.5 Ccf per month will see an increase of 93.54/month, an overall increase of 5.1 %.

3 o o The average transportation customer using 8,19.8 Ccf per month will see an increase of.38/month, an overall increase of 1.1%. The average public authority customer using Ccfper month will see an increase of24.91/month, an overall increase of 5.73%. )> Low natural gas prices allow us to increase our pace of pipe replacement with minimal impact to our residential customers' bills. Since 28, the average customer's monthly bill has changed from to as proposed in this filing. > What is next? o The city coalition will thoroughly review the filing to confirm that our rates are calculated correctly and adhere to state law. o Atmos Energy will review the city coalition's conclusions and work to determine final rates which will be implemented on October 1, 219.

4 Atmos Energy Corporation West Texas Division West Texas Cities Division Rate Review Mechanism Filing Table of Contents Cover Letter Executive Summary Attestation of Filing Attestation of Filing- Philip R. Littlejohn Proposed Tariffs Residential Gas Service Commercial Gas Service Industrial Gas Service Public Authority Gas Service Transportation Gas Service Current Tariffs Residential Gas Service Commercial Gas Service Industrial Gas Service Public Authority Gas Service Transportation Gas Service Narrative of Changes Notice RRM- Cost of Service Schedules and Workpapers Atmos Energy Corporation, West Texas Cities Rate Review Mechanism, Test Year Ending December 31, 218 Total to Adjusted Reconciliation RRM- Billing Determinants Study and Workpapers Atmos Energy Corporation, West Texas Division, Billing Determinants Study

5 WEST TEXAS DIVISION RATE REVIEW MECHANISM BEFORE THE RESPECTIVE GOVERNING BODY OF THE, WEST TEXAS DIVISION CITIES AND TOWNS ATTESTATION OF PHILIP R. LITTLEJOHN Before me, the undersigned authority, on this date personally appeared Philip R. Littlejohn, known to me to be the person whose name is subscribed below, and being by me first duly sworn, stated upon oath as follows: I. " My name is Philp R. Littlejohn. I am Vice President of Rates and Regulatory Affairs for Atrnos Energy Corporation's West Texas Division. I have approximately 9 years of experience in the natural gas utility industry. I am fully competent to make this affidavit, and each statement of fact herein is true of my own personal knowledge." 2. "I affirm that the schedules filed by the Company in this rate review mechanism filing are in compliance with the provisions of the rate review mechanism tariff and are true and correct to the best of my own personal knowledge." SWORN AND SUBSCRIBED before me this thec:s~ ~day of March, 219.

6 WEST TEXAS DIVISION RATE SCHEDULE: APPLICABLE TO: RESIDENTIAL GAS SERVICE WEST TEXAS CITIES SERVICE AREA- Inside City Limits (ICL) EFFECTIVE DATE: Bills Rendered on and after 1/119 I Availability This schedule is applicable to general use by Residential customers for heating, cooking, refrigeration, water heating and other similar type uses. This schedule is not available for service to premises with an alternative supply of natural gas. Monthly Rate Charge..... Amount Customer Charge 16.8 Consumption Charge per Ccf The West Texas Division Gas Cost Adjustment Rider applies to this schedule. The West Texas Division Weather Normalization Adjustment Rider applies to this schedule. The West Texas Division Rider TAX applies to this schedule. The West Texas Division Rider FF applies to this schedule. The West Texas Division Rider RRM applies to this schedule. Miscellaneous Charges: Plus an amount for miscellaneous charges calculated in accordance with the applicable rider(s).

7 WEST TEXAS DIVISION RATE SCHEDULE: APPLICABLE TO: COMMERCIAL GAS SERVICE WEST TEXAS CITIES SERVICE AREA- Inside City Limits (ICL) EFFECTIVE DATE: Bills Rendered on and after 1/1/219 I Availability This schedule is applicable to Commercial customers, including hospitals and churches, for heating, cooking, refrigeration, water heating and other similar type uses. This schedule is not available for service to premises with an alternative supply of natural gas. Monthly Rate Charge Amount.... Customer Charge Consumption Charge.156 per Ccf The West Texas Division Gas Cost Adjustment Rider applies to this schedule. The West Texas Division Weather Normalization Adjustment Rider applies to this schedule. The West Texas Division Rider TAX applies to this schedule. The West Texas Division Rider FF applies to this schedule. The West Texas Division Rider RRM applies to this schedule. Miscellaneous Charges: Plus an amount for miscellaneous charges calculated in accordance with the applicable rider(s).

8 WEST TEXAS DIVISION RATE SCHEDULE: APPLICABLE TO: INDUSTRIAL GAS SERVICE WEST TEXAS CITIES SERVICE AREA- Inside City Limits (ICL) EFFECTIVE DATE: Bills Rendered on and after 1/1/219 I Availability This schedule is applicable to the sales to any industrial or commercial customer whose predominant use of natural gas is other than space heating, cooking, water heating or other similar type uses. Service under this schedule is available to eligible customers following execution of a contract specifying the maximum hourly load. This schedule is not available for service to premises with an alternative supply of natural gas. Monthly Rate Charge Amount Customer Charge 478. Consumption Charge.9493 per Ccf The West Texas Division Gas Cost Adjustment Rider applies to this schedule. The West Texas Division Rider TAX applies to this schedule. The West Texas Division Rider FF applies to this schedule. The West Texas Division Rider RRM applies to this schedule. Miscellaneous Charges: Plus an amount for miscellaneous charges calculated in accordance with the applicable rider(s).

9 WEST TEXAS DIVISION RATE SCHEDULE: APPLICABLE TO: PUBLIC AUTHORITY GAS SERVICE WEST TEXAS CITIES SERVICE AREA- Inside City Limits (ICL) EFFECTIVE DATE: Bills Rendered on and after 1/1/219 I Availability This schedule is applicable to general use by Public Authority type customers, including public schools, for heating, cooking, refrigeration, water heating and other similar type uses. This schedule is not available for service to premises with an alternative supply of natural gas. Monthly Rate Charge.... Amount Customer Charge Consumption Charge per Ccf The West Texas Division Gas Cost Adjustment Rider applies to this schedule. The West Texas Division Weather Normalization Adjustment Rider applies to this schedule. The West Texas Division Rider TAX applies to this schedule. The West Texas Division Rider FF applies to this schedule. The West Texas Division Rider RRM applies to this schedule. Miscellaneous Charges: Plus an amount for miscellaneous charges calculated in accordance with the applicable rider(s).

10 WEST TEXAS DIVISION RATE SCHEDULE: APPLICABLE TO: TRANSPORTATION SERVICE WEST TEXAS CITIES SERVICE AREA- Inside City Limits (ICL) EFFECTIVE DATE: Bills Rendered on and after 1/119 I Application Applicable, in the event that Company has entered into a Transportation Agreement, to a customer directly connected to the Atmos Energy Corp., West Texas Division Distribution System for the transportation of all natural gas supplied by Customer or Customer's agent at one Point of Delivery for use in Customer's facility with an estimated annual usage greater than 1, Ccf per meter. Type of Service Where service of the type desired by Customer is not already available at the Point of Delivery, additional charges and special contract arrangements between Company and Customer may be required prior to service being furnished. Monthly Rate Customer's bill will be calculated by adding the following Customer and Ccf charges to the amounts and quantities due under the riders listed below: Charge. _ Amount Customer Charge per Meter Consumption Charge 478. per month.9493 per Ccf Upstream Transportation Cost Recovery: The customer is responsible for all upstream transportation costs. Retention Adjustment: Plus a quantity of gas equal to the Company's most recently calculated financial L&U percentage for the twelve months ended September multiplied by the gas received into Atmos Energy Corporation's West Texas Division for transportation to the customer. Franchise Fee Adjustment: Plus an amount for franchise fees calculated in accordance with Rider FF. Rider FF is only applicable to customers inside the corporate limits of any incorporated municipality. Tax Adjustment: Plus an amount for tax calculated in accordance with Rider TAX. Surcharges: Plus an amount for surcharges calculated in accordance with the applicable rider(s). Miscellaneous Charges: Plus an amount for miscellaneous charges calculated in accordance with the applicable rider(s). The West Texas Division Rider RRM applies to this schedule. Conversions: Units may be converted from Ccf to Mel or Mmbtu as necessary to comply with the underlying transportation agreement.

11 WEST TEXAS DIVISION RATE SCHEDULE: APPLICABLE TO: TRANSPORTATION SERVICE WEST TEXAS CITIES SERVICE AREA- Inside City Limits (ICL) EFFECTIVE DATE: Bills Rendered on and after 1/1/219 I Imbalance Fees All fees charged to Customer under this Rate Schedule will be charged based on the quantities determined under the applicable Transportation Agreement and quantities will not be aggregated for any Customer with multiple Transportation Agreements for the purposes of such fees. Monthly Imbalance Fees Customer shall pay Company a monthly imbalance fee at the end of each month as defined in the applicable Transportation Agreement, Curtailment Overpull Fee Upon notification by Company of an event of curtailment or interruption of Customer's deliveries, Customer will, for each MMBtu delivered in excess of the stated level of curtailment or interruption, pay Company 2% of the "Index" price reported for the month of delivery in Inside FERC's Gas Market Report under the heading "West Texas Waha". Replacement Index In the event the "Index" price reported for the month of delivery in Inside FERC's Gas Market Report under the heading "West Texas Waha" is no longer published, Company will calculate the applicable imbalance fees utilizing a daily price index recognized as authoritative by the natural gas industry and most closely approximating the applicable index. Agreement A transportation agreement is required. Notice Service hereunder and the rates for services provided are subject to the orders of regulatory bodies having jurisdiction and to the Company's Tariff for Gas Service. Special Conditions In order to receive transportation service under this tariff, customer must have the type of meter, instrumentation, and communication required by Company. Customer must pay Company all costs associated with the acquisition and installation of the required equipment.

12 WEST TEXAS DIVISION RRC TARIFF NO: RATE SCHEDULE: APPLICABLE TO: RESIDENTIAL GAS SERVICE WEST TEXAS CITIES SERVICE AREA- Inside City Limits (ICL) EFFECTIVE DATE: Bills Rendered on and after 1/1/218 I PAGE: 17 Availability This schedule is applicable to general use by Residential customers for heating, cooking, refrigeration, water heating and other similar type uses. This schedule is not available for service to premises with an alternative supply of natural gas. Monthly Rate Charge Amount.... Customer Charge 16.1 Consumption Charge per Ccf The West Texas Division Gas Cost Adjustment Rider applies to this schedule. The West Texas Division Weather Normalization Adjustment Rider applies to this schedule. The West Texas Division Rider TAX applies to this schedule. The West Texas Division Rider FF applies to this schedule. The West Texas Division Rider RRM applies to this schedule. Miscellaneous Charges: Plus an amount for miscellaneous charges calculated in accordance with the applicable rider(s).

13 WEST TEXAS DIVISION RRC TARIFF NO: RATE SCHEDULE: APPLICABLE TO: COMMERCIAL GAS SERVICE WEST TEXAS CITIES SERVICE AREA- Inside City Limits (ICL) EFFECTIVE DATE: Bills Rendered on and after 1/1/218 I PAGE: 18 Availability This schedule is applicable to Commercial customers, including hospitals and churches, for heating, cooking, refrigeration, water heating and other similar type uses. This schedule is not available for service to premises with an alternative supply of natural gas. Monthly Rate Charge... Amount Customer Charge Consumption Charge per Ccf The West Texas Division Gas Cost Adjustment Rider applies to this schedule. The West Texas Division Weather Normalization Adjustment Rider applies to this schedule. The West Texas Division Rider TAX applies to this schedule. The West Texas Division Rider FF applies to this schedule. The West Texas Division Rider RRM applies to this schedule. Miscellaneous Charges: Plus an amount for miscellaneous charges calculated in accordance with the applicable rider(s).

14 WEST TEXAS DIVISION RRC TARIFF NO: RATE SCHEDULE: APPLICABLE TO: INDUSTRIAL GAS SERVICE WEST TEXAS CITIES SERVICE AREA- Inside City Limits (ICL) EFFECTIVE DATE: Bills Rendered on and after 1/1/218 I PAGE: 19 Availability This schedule is applicable to the sales to any industrial or commercial customer whose predominant use of natural gas is other than space heating, cooking, water heating or other similar type uses. Service under this schedule is available to eligible customers following execution of a contract specifying the maximum hourly load. This schedule is not available for service to premises with an alternative supply of natural gas. Monthly Rate Charge Amount Customer Charge 49. Consumption Charge.8944 per Ccf The West Texas Division Gas Cost Adjustment Rider applies to this schedule. The West Texas Division Rider TAX applies to this schedule. The West Texas Division Rider FF applies to this schedule. The West Texas Division Rider RRM applies to this schedule. Miscellaneous Charges: Plus an amount for miscellaneous charges calculated in accordance with the applicable rider(s).

15 WEST TEXAS DIVISION RRC TARIFF NO: RATE SCHEDULE: APPLICABLE TO: PUBLIC AUTHORITY GAS SERVICE WEST TEXAS CITIES SERVICE AREA- Inside City Limits (ICL) EFFECTIVE DATE: Bills Rendered on and after 1 /1/218 I PAGE: 2 Availability This schedule is applicable to general use by Public Authority type customers, including public schools, for heating, cooking, refrigeration, water heating and other similar type uses. This schedule is not available for service to premises with an alternative supply of natural gas. Monthly Rate Charge. Amount Customer Charge 2.25 Consumption Charge per Ccf The West Texas Division Gas Cost Adjustment Rider applies to this schedule. The West Texas Division Weather Normalization Adjustment Rider applies to this schedule. The West Texas Division Rider TAX applies to this schedule. The West Texas Division Rider FF applies to this schedule. The West Texas Division Rider RRM applies to this schedule. Miscellaneous Charges: Plus an amount for miscellaneous charges calculated in accordance with the applicable rider(s).

16 WEST TEXAS DIVISION RATE SCHEDULE: APPLICABLE TO: TRANSPORTATION SERVICE WEST TEXAS CITIES SERVICE AREA- Inside City Limits (ICL) EFFECTIVE DATE: Bills Rendered on and after 1/1/218 I PAGE: 21 Application Applicable, in the event that Company has entered into a Transportation Agreement, to a customer directly connected to the Almas Energy Corp., West Texas Division Distribution System for the transportation of all natural gas supplied by Customer or Customer's agent at one Point of Delivery for use in Customer's facility with an estimated annual usage greater than 1, Ccf per meter. Type of Service Where service of the type desired by Customer is not already available at the Point of Delivery, additional charges and special contract arrangements between Company and Customer may be required prior to service being furnished. Monthly Rate Customer's bill will be calculated by adding the following Customer and Ccf charges to the amounts and quantities due under the riders listed below: Charge Amount Customer Charge per Meter Consumption Charge 49. per month.8944 per Ccf Upstream Transportation Cost Recovery: The customer is responsible for all upstream transportation costs. Retention Adjustment: Plus a quantity of gas equal to the Company's most recently calculated financial L&U percentage for the twelve months ended September multiplied by the gas received into Almas Energy Corporation's West Texas Division for transportation to the customer. Franchise Fee Adjustment: Plus an amount for franchise fees calculated in accordance with Rider FF. Rider FF is only applicable to customers inside the corporate limits of any incorporated municipality. Tax Adjustment: Plus an amount for tax calculated in accordance with Rider TAX. Surcharges: Plus an amount for surcharges calculated in accordance with the applicable rider(s). Miscellaneous Charges: Plus an amount for miscellaneous charges calculated in accordance with the applicable rider(s). The West Texas Division Rider RRM applies to this schedule. Conversions: Units may be converted from Ccf to Mcf or Mmbtu as necessary to comply with the underlying transportation agreement.

17 WEST TEXAS DIVISION RATE SCHEDULE: APPLICABLE TO: TRANSPORTATION SERVICE WEST TEXAS CITIES SERVICE AREA- Inside City Limits (ICL) EFFECTIVE DATE: Bills Rendered on and after 1/1/218 I PAGE: 22 Imbalance Fees All fees charged to Customer under this Rate Schedule will be charged based on the quantities determined under the applicable Transportation Agreement and quantities will not be aggregated for any Customer with multiple Transportation Agreements for the purposes of such fees. Monthly Imbalance Fees Customer shall pay Company a monthly imbalance fee at the end of each month as defined in the applicable Transportation Agreement, Curtailment Overpull Fee Upon notification by Company of an event of curtailment or interruption of Customer's deliveries, Customer will, for each MMBtu delivered in excess of the stated level of curtailment or interruption, pay Company 2% of the "Index" price reported for the month of delivery in Inside FERC's Gas Market Report under the heading "West Texas Waha". Replacement Index In the event the "Index" price reported for the month of delivery in Inside FERC's Gas Market Report under the heading "West Texas Waha" is no longer published, Company will calculate the applicable imbalance fees utilizing a daily price index recognized as authoritative by the natural gas industry and most closely approximating the applicable index. Agreement A transportation agreement is required. Notice Service hereunder and the rates for services provided are subject to the orders of regulatory bodies having jurisdiction and to the Company's Tariff for Gas Service. Special Conditions In order to receive transportation service under this tariff, customer must have the type of meter, instrumentation, and communication required by Company. Customer must pay Company all costs associated with the acquisition and installation of the required equipment.

18 , WEST TEXAS DIVISION WEST TEXAS CITIES RATE DIVISION NARRATIVE OF CHANGES The Company's second Rate Review Mechanism ("RRM") filing under the tariff negotiated in February 218 is for the period ending December 31, 218. The filing package reflects a system-wide cost of service increase in the amount of14.8 million. Of this amount, 6.2 million is attributable to the West Texas Cities Rate Division. The differences between the 217 West Texas Cities RRM filing and this filing are highlighted below: Shared Services Division ("SSU") allocation rates have been updated to fiscal year 219 factors as per the tariff. The SSU Service Level Factors Adjustment is detailed in the Cost of Service filing on WP _F-2.7. WP _F in the filing details the function of each cost center. The capitalized and expensed West Texas incentive compensation (VPP, MIP, LTIP) has been adjusted to target, along with a comparable adjustment to the West Texas Direct and West Texas General Office ADIT item, "MIPNPP Accrual" on WP _B-6.

19 PUBLIC NOTICE OF PROPOSED RATE CHANGE NATURAL GAS UTILITY RATES If you are receiving this notice, you are a customer of Atmos Energy Corporation, West Texas Division ("Atmos Energy" or "the Company") and a change to your gas rates has been requested. On April!, 219, Atmos Energy filed its annual Rate Review Mechanism ("RRM") to change natural gas rates and implement a new schedule of rates and riders applicable to all customers within the incorporated cities served by the West Texas Cities Rate Division. The proposed effective date of the requested rate changes is October I, 219. If approved, the proposed changes will affect approximately 6,399 residential, I,234 commercial, 37 industrial and transportation, and 1,362 public authority customers. If approved, the proposed rates will change the Company's annual revenues for the incorporated areas of the West Texas Cities Rate Division by approximately 6,226,29, or 11.86%, excluding gas cost. The proposed change in rates constitutes a "major change" as that term is defined by Section of the Texas Utilities Code. The Company proposes to implement the rates included in Table I below: TABLE 1-Proposed Changes for Incorporated West Texas Cities Customers Number of Current Proposed Current Proposed Customers Customer Customer Consumption Consumption Customer Class Affected Charge Charge Charge (per Ccl) Charge (per Ccl) Residential 6, Commercial 1, Industrial & Transportation Public Authority 1, TABLE 2 -Impact on Average Bill Current Proposed Average Average Proposed Percentage Percentage Customer Class (Average Monthly Bill Monthly Bill Monthly Change with Change without Monthly Usage Ccl) with Gas Cost with Gas Cost Change Gas Cost Gas Cost Residential ( 49.8) % 11.89% Commercial (247.1) % 11.84% Industrial (3,499.5) 1, , %.22% Transportation (8,19.8) 1, , N/A 1.1% Public Authority (696.2) % 11.55% The above calculations in Table 2 are based on a per Ccf cost of gas. Persons with specific questions or needing additional information about this filing may contact Atmos Energy Corporation at In addition, customers can contact their City for

20 additional information regarding this rate request. Complete copies of the filed Rate Review Mechanism, including all proposed rate and schedule changes, are available for inspection at Atmos Energy's office located at h Street, Lubbock, Texas or on the web site at Este aviso esta destinado a informar a los clientes de la Division de Atmos Energy Corporation del Oeste de Texas ("Atmos Energy" o la "Compafiia") que la Compafiia ha presentado una solicitud para aumentar las tarifas del servicio publico de gas. La aplicacion afecta a todos los clientes residenciales, comerciales, industriales, de transporte y de las autoridades publicas bajo la Tarifa "RRM" en la Division Oeste de Texas. Cualquier persona con preguntas especificas o que desee recibir informacion adicional sabre esta solicitud para aumentar las tarifas debe Hamar a Atmos Energy Corporation al Ademas, los clientes afectados por esta solicitud que deseen enviar comentarios o una carta de protesta sabre esta solicitud a la autoridad reguladora deben comunicarse con su ciudad con la referencia "219 WTX Cities Annual Rate Mechanism". Copias completas de esta solicitud de aumento de tarifa, incluyendo todos los cambios, estan disponibles en las oficinas de Atmos Energy en th Street, Lubbock, Texas o visite nuestro sitio web en

21 COST OF SERVICE SCHEDULES AND WORKPAPERS File Date: April 1, 219 Totals may vary due to rounding.

22 TABLE OF CONTENTS LINE NO. DESCRIPTION SCHEDULE REVENUE REQUIREMENTS 2 RATE BASE 3 COMPONENTS OF RATE BASE- GROSS PLANT 4 COMPONENTS OF RATE BASE-ACCUMULATED DEPRECIATION 5 CASH WORKING CAPITAL 6 OPERATION AND MAINTENANCE EXPENSES 7 ADJUSTMENTS TO OPERATION AND MAINTENANCE EXPENSES 8 DEPRECIATION AND AMORTIZATION EXPENSE 9 DEPRECIATION RATE SUMMARY 1 TAXES OTHER THAN INCOME TAX -ACCOUNT FEDERAL INCOME TAX AND STATE FRANCHISE C'GROSS MARGIN") TAX INTEREST EXPENSE- CUSTOMER DEPOSITS 13 SUMMARY OF RETURN 14 BLANK SHEET 15 BLANK SHEET 16 SUMMARY OF CURRENT AND PROPOSED RATE STRUCTURE Schedule A Schedule B Sch~ule C ScheduleD 9_ghedule E Schedule F-1 Schedule F-2 Schedule F-3 Schedule F-4 Schedule F-5 Schedule F-6.Schedule F-7 Schedule G Schedule H Schedule I Schedule J Table of Contents Page 1 of3

23 TABLE OF CONTENTS TEST YEAR ENDING DECEMBER 31,218 LINE NO. DESCRIPTION WORKPAPER 17 RATE BASE ADJUSTMENTS 18 GUO NOS. 141, 184, 185 RATE BASE ADJUSTMENTS 19 GUO 1174 RATE BASE ADJUSTMENTS 2 CITY SETTLED SOl RATE BASE ADJUSTMENTS RRM RATE BASE ADJUSTMENTS RRM RATE BASE ADJUSTMENTS RRM RATE BASE ADJUSTMENTS RRM RATE BASE ADJUSTMENTS 25 INJURIES AND DAMAGES RESERVES 26 MATERIALS & SUPPLIES & UNDERGROUND STORAGE 27 PREPAYMENTS 28 CUSTOMER DEPOSITS AND CUSTOMER ADVANCES FOR CONSTRUCTION 29 ACCUMULATED DEFERRED INCOME TAXES ('AD IT') 3 AMORTIZATION OF REGULATORY LIABILITY 31 MIDPOINT OF REGULATORY LIABILITY 32 PENSION AND OTHER POST EMPLOYMENT BENEFITS REGULATORY ASSET/LIABILITY 33 PENSION AND OTHER POST EMPLOYMENT BENEFITS REGULATORY ASSET/LIABILITY SUMMARY 34 BEGINNING BALANCE ACCUMULATED DEFERRED INCOME TAXES 35 BASE LABOR ADJUSTMENT 36 MEDICAL AND DENTAL BENEFITS ADJUSTMENT 37 PENSIONS AND RETIREE MEDICAL BENEFITS ADJUSTMENT 38 PENSIONS AND RETIREE MEDICAL BENEFITS FOR APPROVAL 39 PROPERTY INSURANCE ADJUSTMENT 4 BLANK SHEET 41 EMPLOYEE EXPENSE ADJUSTMENT 42 SHARED SERVICES ("SSU") SERVICE-LEVEL FACTORS ADJUSTMENT 43 SHARED SERVICES {"SSU"} COST CENTER FUNCTIONS 44 MISCELLANEOUS ADJUSTMENTS 45 UNCOLLECTIBLE EXPENSE ADJUSTMENT 46 RULE COMPLIANCE ADJUSTMENT 47 BLANK SHEET 48 TAXES OTHER THAN INCOME TAX WORKPAPER 49 SHARED SERVICES f'ssu"} ADJUSTED TOTAL LABOR ALLOCATED TO WEST TEXAS FOR PAYROLL TAX CALCULATION WP B-1 WP B-U WP B-1.2 WP B-1.3 WP B-1.4 WP WP B-1.6 WP B-1.7 WP B-2 WP 8-3 WP 8-4 WP 8-5 WP B-6 WP B-6.1 WP B-6.2 WP 8-7 WP B-7.1 WP E-1 WP F-2.1 WP F-2.2 WP F-2-~ WP F WP F-2.4 WP F-2.5 WP F-2.6 WP F-2.7 WP F ';!;!P F-2.8 WP F-2.9 WP F-2.1 WP F-2.11 WP F-5.1 WP F-5_2 Table of Contents Page 2 of 3

24 TABLE OF CONTENTS LINE NO. DESCRIPTION WORKPAPER 5 SUMMARY PROOF OF REVENUE AT CURRENT RATES 51 CALCULATION OF CURRENT REVENUES BY AREA- RESIDENTIAL 52 CALCULATION OF CURRENT REVENUES BY AREA- COMMERCIAL 53 CALCULATION OF CURRENT REVENUES BY AREA -INDUSTRIAL 54 CALCULATION OF CURRENT REVENUES BY AREA- TRANSPORTATION 55 CALCULATION OF CURRENT REVENUES BY AREA- PUBLIC AUTHORITY 56 OTHER REVENUES 57 SALES AND TRANSPORT CONTRACT MARGINS 58 AVERAGE BILL COMPARISON 59 SUMMARY PROOF OF REVENUE- PROSPECTIVE RATES 6 CALCULATION OF PROPOSED REVENUES BY AREA- RESIDENTIAL 61 CALCULATION OF PROPOSED REVENUES BY AREA- COMMERCIAL 62 CALCULATION OF PROPOSED REVENUES BY AREA- INDUSTRIAL 63 CALCULATION OF PROPOSED REVENUES BY AREA- TRANSPORTATION 64 CALCULATION OF PROPOSED REVENUES BY AREA- PUBLIC AUTHORITY 65 RATE DESIGN 66 ALLOCATION FACTORS WP J-1 J!.YP J-1.1 WP J-1.2 WP J-1.3 WP J-1.4 WP J-1.5 WP J-2 WP J-2.1 WP J-3 WP J-4 WP J-4.1 WP J-4.2 WP J-4.1 WP J-4.4 WP J-4.5 WP J-5 Allocation Factors Table of Contents Page 3 of 3

25 REVENUE REQUIREMENTS Current Proposed Proposed Line No. Description Reference Revenues Revenues (1) Gi:t(:l!:l9~ Percent Change (a) (b) (c) (d) (e) (f) Residential Commercial Industrial and Transportation Public Authority Other Revenue Total Base Revenue Operation and Maintenance Expenses Taxes Other than Income Taxes Depreciation and Amortization Expense Interest on Customer Deposits Rate Base Rate of Return Income Taxes Revenue Requirements Current Revenues Proposed Change -Systemwide Amortization of Excess Accumulated Deferred Income Taxes Proposed Cost of Service -Systemwide Adjusted for Excess AD IT Proposed Change - WTX Cities Workpapers J-1 and J-4 Workpapers J-1 and J-4 Workpapers J-1 and J-4 Workpapers J-1 and J-4 Workpaper J-2 Sum Ln 1 through Ln 5 Schedule F-1 Schedule F-5 Schedule F-3 Schedule F-7 Schedule B Schedule G Col (c), Ln 16 x Ln 17 Schedule F-6 Col (d), Sum of Ln 8 through Ln 2 Col (c), Ln 6 Col (d), Ln 22 minus Ln 23 WP_B-6.1 Ln25-Ln27 WP _J-4.1 through WP _J Note: Proposed Revenues are the result of the application of the proposed rates to billing determinants. These amounts exclude gas cost. 89,795,95 24,8,589 3,557,649 5,498,51 591,5, % 1,788,977 26,991,467 3,877,948 6,138,794 45,613,153 8,737,682 32,651,913 52,482 46,758,35 1,262,74 144,76,275 6,87,89 17,269,186 2,451,651 14,817,535 6,226,29 1,993,27 2,862,878 32,299 64,744.24% 11.87% 9.% 11.65% Schedule A Page 1 of 1

26 RATE BASE TEST YEAR ENDING DECEMBER 31,218 Line No. Amount per Description Reference Books (a) (b) (c) Adjustment (d)- (e)- (c) Total Requested (e) Net Plant 11 l: Gross Plant Schedule C 876,697,151 Accumulated Depreciation ScheduleD 179,693,966 Total Net Plant (Ln 2- Ln 3) 697,3,185 Additions: Gas Stored - Current WP_B-3 5,297,94 Materials & Supplies WP_B-3 672,928 Prepayments WP_B-4 3,267,29 Pension and Other Postemployment Benefits Regulatory Asset/Liability WP_B-7.1 (4,349,846) Total Additions (Sum Ln 7 through Ln 1) 4,887,384 Deductions: Customer Deposits WP_B-5 2,733,425 Customer Advances for Construction WP_B-5 Injuries and Damages Reserve WP_B-2 1,722,825 Accumulated Deferred Income Taxes WP_B-6 69,35,795 Regulatory Liability (Account 253, Sub-Account 2799) (2) WP _B-6.1,6.2 58,541,725 Rate Base Adjustments WP _B-1 Total Deductions (Sum Ln 14 through Ln 19) 132,33,77 Total Cash Working Capital Schedule E Total Rate Base (Ln 4 + Ln 11 - Ln 2 + Ln 22) 569,856,8 1,94, ,62,118 (15,5) 179,543,961 11,54,972 78,58,157 41,253 5,77,347 (52,768) 152,16 (49,677) 2,857,532 () (4,349,846) (52, 192) 4,367,192 2,733,425 (1,296,998) 425,827 (11,644,388) 57,391,47 (3,379,583) 55,162,142 1,317,363 1,317,363 (15,3,66) 117,3,164 (3,882,322) (3,882,322) 21,656,63 591,5,863 Notes: 1. Rate Base excludes projects previously disallowed and includes other known and measurable adjustments. 2. The Regulatory Liability represents the excess defered income taxes resulting from the revaluation of AD IT due to the Tax Cuts and Jobs Act. Schedule B Page 1 of 1

27 RATE BASE ADJUSTMENTS Line No. Description Amounts (a) (b) 1 GUO Nos. 141, 184, 185 Amortization of Employee Expenses- Unincorporated Areas (WP_B-1.1) 34,1 2 GUO No Amortization of Employee Expenses, TYE March 31, 2 (WP_B-1.2) (1) 18,491 3 City Settled SOl Amortization of Employee Expenses, TYE June 3, 213 (WP_B-1.3) (2) 16, WTX Cities RRM Amortization of Employee Expenses, TYE September 3, 214 (WP_B-1.4) (3) 5, WTX Cities RRM Amortization of Employee Expenses, TYE September 3, 215 (WP_B-1.5) (4) 4, WTX Cities RRM Amortization of Employee Expenses, TYE September 3, 216 (WP_B-1.6) (5) 14, WTX Cities RRM Amortization of Employee Expenses, TYE December 31,217 (WP_B-1.7) (6) 953,744 8 Employee Expense Adjustment, TYE December31, 218 (7) 9 Employee-Related Expenses not included in Expense Reports (8) 1 Capitalized Severence Pay Adjustment, TYE December 31,218 (9) 11 Capitalized West Texas VPP Incentive Compensation Adjusted Back to Target, TYE December 31, 218 (1 ) Capitalized West Texas MIP Incentive Compensation Adjusted Back to Target, TYE December 31, 218 (1 ) 13 Capitalized West Texas L TIP Incentive Compensation Adjusted Back to Target, TYE December 31, 218 (1 ) 14 Capitalized SSU MIPNPP and LTIP Incentive Compensation Adjustment, TYE December 31, 218 (11) Total (Sum of Ln 1 through Ln 14) 1,317, Notes: In GUO No. 1174, rate base was approved through March 31, The adjustment covers the period of April 1, 2 through June 3, The adjustment covers the period of July 1, 213 through September 3, The adjustment covers the period of October 1, 214 through September 3, The adjustment covers the period of October 1, 215 through September 3, The adjustment covers the period of October 1, 216 through December 31, See Page 2, Column (f), Ln 13. The adjustment covers the periods January 1, 218- December 31, Other Employee-Related Expenses adjusted beginning January 1, 218 through December 31, 218 for 54 and 9 Series Review Severence Pay voluntarily removed by Company to reduce controversy in this filing. There is no severence pay in CY Remove Capitalized West Texas Direct Incentive Compensation paid above target to align with the Final Order in GUO No Remove Capitalized SSU Incentive Compensation in conformance with RRM Tariff, Section Ill- Calculation, "RI" definition. WP _B-1 Page 1 of 2

28 RATE BASE ADJUSTMENTS Line No. Description (a) Shared Services- Shared Services - Customer General Office Support () (2) (b) (c) WTX Direct (d) WTX General Office (e) Total Adjustment (f) Twelve Months Ended December 31,218 Employee Expense Adjustment West Texas Allocation Factor (1) (2) Allocated Employee Expense Totals (Ln 2 x Ln 3) Capitalization Factor (2) (3) Subtotal (Ln 4 x Ln 5) 8 Add Charges Direct to Capital: 9 Employee Expense Adjustment (January 1, 218- December 31, 218) 1 West Texas Allocation Factor (1) (2) 11 Allocated Employee Expense Totals (Ln 9 x Ln 1 ) Total For the Period Ended December 31, 218 (Ln 6 + Ln 11) 9.62% 7.33%.39% 26.23% 9.62% 7.33% - 15 Notes: See WP _F-2.6, Col (b) and Col (c), Ln 3, as applicable, for the Shared Services factors, as adjusted West Texas direct costs are directly charged and not allocated For Columns (b) and (c), see WP _F-2.6, Ln 5, [1- Col (b)], [1-Col (c)]. 1.% 95.66%.%.% 1.% 95.66% WP _B-1 Page 2 of2

29 GUO NOS.141, 184, 185 RATE BASE ADJUSTMENTS AMORTIZATION SCHEUDLE Line No. Beginning of Year End of Year Rate Base Rate Base Year Ended Adjustment Annual Adjustment Oec.31 Amount Amortization (1) Amount (2) (a) (b) (c) (d) Balance as of December 31, 218 (e) , , , ,39 37, ,668 13, ,359 13, , , ,431 13, , , , , ,193 13,39 25, ,883 13, ,574 13,39 224, , , , ,39 184, ,336 13,39 171, ,39 157, , , , ,98 13,39 117, ,789 13, , ,39 77, ,86 13,39 64, ,551 13, , , ,622 13,39 11, ,313 11, Notes: The annual amortization is calculated based upon the same period reflected in 36 GUO No. 967, an Atmos Energy Corp., Mid-Tex Division case, Schedule B, Page 2, 37 Footnote 1 (3.85 years) The December 31,21 amount is per the Unincorporated Summary found in 4 relied file, "WP_B-1.1 thru B-1.7- Capita! Amortization.xlsx" * Totals may vary due to rounding. 34,1 WP_B-1.1 Page 1 of 1

30 GUO 1174 RATE BASE ADJUSTMENTS AMORTIZATION SCHEDULE' Line No. Beginning of Year End of Year Rate Base Rate Base Year Ended Adjustment Annual Adjustment Sep. 3 Amount Amortization (1) Amount(2) (a) (b) (c) (d) Balance as of December 31, 218 (e) , , , , , , , , , , , , , , , , , , , , , , , , , , , ,22 784, , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,491 Notes: The annual amortization is calculated based upon the same period reflected in 36 GUD No. 967, an Atmos Energy Corp., Mid-Tex Division case, Schedule 8, Page 2, 37 Footnote 1 (3.85 years) The September 3, 211 amount is per the GUD No Employee Expense 4 Rate Base Adjustment found in relied file, "WP_8-1.1 thru B-1.7- Capital Amortization.xlsx" * Totals may vary due to rounding. WP_B-1.2 Page 1 of 1

31 WEST TEXAS CITIES (''WTX CITIES") RATE REVIEW MECHANISM CITY SETTLED SOl RATE BASE ADJUSTMENTS AMORTIZATION SCHEDULE Line No. Year Ended Jun. 3 (a) Beginning of Year End of Year Rate Base Rate Base Adjustment Annual Adjustment Amount Amortization (1) Amount (2~ (b) (c) (d) Balance as of December 31, 218 (e) ,776 19, ,135 19, ,494 18, ,853 17, ,2 17, ,571 16, ,93 15, ,289 15, ,648 14, ,7 14, ,366 13, ,725, ,84, ,443 11, ,82 1, ,161 1, ,52 9, ,879 8, ,237 8, ,596 7, ,955 6, ,314 6, ,673 5, ,32 5, ,391 4, ,75 3, ,19 3, ,468 2, ,827 1, ,186 1, ,251 Notes: The annual amortization is calculated based upon the same period reflected in 36 GUO No. 967, an Atmos Energy Corp., Mid-Tex Division case, Schedule B, Page 2, 37 Footnote 1 (3.85 years) The June 3,213 amount is per the City Settled SOl Filing Employee Expense 4 Rate Base Adjustment found in relied file, "WP_8-1.1 thru B-1.7- Capital Amortization.xlsx" * Totals may vary_due to rounding. WP_B-1.3 Page 1 of 1

32 214 RRM RATE BASE ADJUSTMENTS AMORTIZATION SCHEDULE' Line No. Beginning of Year End of Year Rate Base Rate Base Balance as of Year Ended Adjustment Annual Adjustment December 31, Sep.3 Amount Amortization (1~ Amount(2) 218 (a) (b) (c) (d) (e) ,852 5,662 5,472 5,283 5,93 4,93 4,714 4,524 4,334 4,145 3,955 3,765 3,576 3,386 3,196 3,6 2,817 2,627 2,437 2,248 2,58 1,868 1,679 1,489 1,299 1 ' , , , , , , , , , , , , , , , ,6 19 2, , , , , , , , , ' Notes: The annual amortization is calculated based upon the same period reflected in 36 GUO No. 967, an Atmos Energy Corp., Mid-Tex Division case, Schedule B, Page 2, 37 Footnote 1 (3.85 years) The September 3, 214 amount is per the 214 VVTX RRM Filing Employee Expense 4 Rate Base Adjustment found in relied file, "WP_B-1.1 thru Capital Amortization.xlsx" * Totals may vary due to rounding. 5,46 WP _8-1.4 Page 1 of 1

33 215 RRM RATE BASE ADJUSTMENTS AMORTIZATION SCHEDULE Beginning of Year End of Year Rate Base Rate Base Year Ended Adjustment Annual Adjustment Line No. Sep_~---~9 Amount Amortization (1) Amount (2) (a) (b) (c) (d) Balance as of December 31, 218 (e) , , , , , , , , , , , , , , , , , , , , , , , , , , ,411 5,235 5,6 4,885 4,79 4,534 4,358 4,183 4,8 3,832 3,657 3,481 3,36 3,131 2,955 2,78 2,64 2,429 2,254 2,78 1,93 1,728 1,552 1,377 1,21 1, Notes: The annual amortization is calculated based upon the same period reflected in 36 GUD No. 967, an Atmos Energy Corp., Mid-Tex Division case, Schedule B, Page 2, 37 Footnote 1 (3.85 years) The September 3, 215 amount is per the 215 WfX RRM Filing Employee Expense 4 Rate Base Adjustment found in relied file, "WP_8-1.1 thru B-1.7- Capital Amortization.x!sx" * Totals may vary due to rounding. 4,841 WP_B-1.5 Page 1 of 1

34 216 RRM RATE BASE ADJUSTMENTS AMORTIZATION SCHEDULE Beginning of Year End of Year Rate Base Rate Base Year Ended Adjustment Annual Adjustment Line No. Sep. 3 Amount Amortization (1} Amount {2} (a) (b) (c) (d) Balance as of December 31, 218 (e) Notes: , , , , , , 22 14, , , , ,44 52,92 223,92 52,4 224, , , , , , , , , , , , , , , , , , , , , , , , , , , , ,1 52 4, , , , , , , , , , , ,2 52 1, , WP _8-1.6 Page 1 of 1

35 217 RRM RATE BASE ADJUSTMENTS AMORTIZATION SCHEDULE' Line No. Beginning of Year End of Year Rate Base Rate Base Year Ended Adjustment Annual Adjustment Dec.31 Amount Amortization {1) Amount (2) (a) (b) (c) (d) Balance as of December 31, 218 (e) , ,695 31, , ,744 31, , ,793 31, , ,842 31, , ,89 31, , ,939 31, , ,988 31, , ,37 31,951 73, ,86 31, , ,134 31, , ,183 31, , ,232 31,951 62, ,281 31,951 57, ,329 31, , ,378 31,951 56, ,427 31, , ,476 31, , ,524 31,951 41, ,573 31, , ,622 31, , ,671 31, , ,72 31, , ,768 31,951 25, ,817 31, , ,866 31, , ,915 31, , ,963 31,951 3, 245 3, 31,951 91, ,61 31,951 59, ,11 31,951 27, ,158 27, ,744 Notes: The annual amortization is calculated based upon the same period reflected in 36 GUO No. 967, an Atmos Energy Corp., Mid-Tex Division case, Schedule B, Page 2, 37 Footnote 1 (3.85 years) The December 31, 217 amount is per the 217 WTX RRM Filing Employee Expense 4 Rate Base Adjustment found in relied file, "WP_B-1.1 thru B-1.7- Capital Amortization.xlsx" * Totals may vary due to rounding. WP_B-1.7 Page 1 of 1

36 INJURIES AND DAMAGES RESERVES (1) Line No. Per Book MonthlY ear Ending Amount Adjustments (2) Adjusted Amount (a) (b) (c) (d)- (b)+ (c) Allocation Factor (e) Allocated Amount (f)= (d)* (e) West Texas Direct: December 31, January 31,218 - February 28, March 31,218 - April 3, May 31,218 June 3, 218 July 31,218 - August31, 218 September 3, October31, November 3, 218 December31, % 1.% 1.% 1.% 1.% 1.% 1.% 1.% 1.% 1.% 1.% 1.% 1.% WP_B-2 Page 1 of4

37 INJURIES AND DAMAGES RESERVES (1) TEST YEAR ENDING DECEMBER 31,218 Line No. Per Book Month\ Year Ending Amount Adjustments (2) Adjusted Amount (a) (b) (c) (d)- (b)+ (c) Allocation Factor (e) Allocated Amount (f)- (d)* (e) WTX General Office {Div 1 }: December 31, , ,693 January 31, , ,375 February 28, ,164 46,164 March 31, , ,416 April 3, ,17 414,17 May31, , ,218 June 3, ,697 37,697 July 31, ,23-444,23 August 31, , ,397 September 3, , ,894 October31, ,95-435,95 November 3, , ,135 December31, ,22 421, % 95.66% 95.66% 95.66% 95.66% 95.66% 95.66% 95.66% 95.66% 95.66% 95.66% 95.66% 95.66% 4, , , , ,51 375, , ,953 45,98 418, , ,95 42,753 WP_B-2 Page 2 of 4

38 INJURIES AND DAMAGES RESERVES (1) TEST YEAR ENDING DECEMBER 31,218 Line Per Book No. MonthlY ear Ending Amount Adjustments (2) Adjusted Amount (a) (b) (c) (d)- (b)+ (c) 29 SSU General Office {Div 2): 3 December 31,217 7,697,75 (7,383, 771) 313,34 31 January 31,218 7,74,867 (7,383,771) 321,96 32 February 28, 218 7,7,941 (7,383,771) 329, March 31, 218,21,337 (11,883, 771) 326, April 3, 218,229,113 (11,883, 771) 345, May31, 218,235,624 (11,883, 771) 351, June 3, 218 1,619,171 (1,288, 17) 331,1 37 July 31,218,62,583 (,288, 17) 332,4 38 August 31, 218,617,772 (,288, 17) 329,62 39 September 3, ,27,842 (17,7, 17) 327,671 4 October31, ,19,155 (17,7, 17) 318, November 3, ,19,141 (17,7, 17) 318, December 31, ,15,67 (17,7, 17) 314,897 Allocation Factor (e) 7.33% 7.33% 7.33% 7.33% 7.33% 7.33% 7.33% 7.33% 7.33% 7.33% 7.33% 7.33% 7.33% Allocated Amount (f)- (d)* (e) 22,958 23,529 24, 23,929 25,35 25,782 24,254 24,358 24,152 24,1 23,374 23,373 23,74 WP_B-2 Page 3 of4

39 INJURIES AND DAMAGES RESERVES (1) Line No. Per Book MonthlY ear Ending Amount Adjustments (2) Adjusted Amount (a) (b) (c) (d)- (b)+ (c) Allocation Factor (e) Allocated Amount (f)- (d)* (e) SSU Customer SU!lllOrt {Div ): December 31, January 31, February 28, March 31,218 - April 3, May 31, June 3, July 31,218 - August 31, September 3, 218 October 31,218 - November 3, December 31, Total at December31, 218 (Col (f)= Ln 14 + Ln 28 + Ln 42 + Ln 56) 1,722, % 9.62% 9.62% 9.62% 9.62% 9.62% 9.62% 9.62% 9.62% 9.62% 9.62% 9.62% 9.62% 425,827 Notes: 1. Account and sub accounts 2811 and The adjustment amounts in Column (c) for Division 2 remove SSU reserves not allocated to the divisions, sub account WP_B-2 Page 4 of 4

40 MATERIALS & SUPPLIES & UNDERGROUND STORAGE Line Per Book No. MonthlY ear Ending Amount Adjustments Adjusted Amount (a) (b) (c) (d)- (b)+ (c) 1 Materials & Supplies- Accts. 154 & 163: 2 West Texas Direct: 3 December 31, 217 (29,447) - (29,447) 4 January 31,218 (39,362) (39,362) 5 February 28, 218 (48,191) (48,191) 6 March 31,218 (6,29) (6,29) 7 April 3, 218 (71,96) (71,96) 8 May 31,218 (81,97) (81,97) 9 June 3, 218 (94,75) - (94,75) 1 July 31,218 (1 3,62) (1 3,62) 11 August 31,218 (119,227) (119,227) September 3, 218 (131,681) (131,681) 13 October 31,218 (1,864) (1,864) 14 November 3, 218 (21,445) - (21,445) 15 December 31, 218 (31,699) - (31,699) Month Average (64,849) (64,849) 18 Allocation Factor (e) 1.% 1.% 1.% 1.% 1.% 1.% 1.% 1.% 1.% 1.% 1.% 1.% 1.% Allocated Amount (f)- (d)* (e) (29,447) (39,362) (48,191) (6,29) (71,96) (81,97) (94,75) (1 3,62) (119,227) (131,681) (1,864) (21,445) (31,699) (64,849) WP_B-3 Page 1 of 3

41 MATERIALS & SUPPLIES & UNDERGROUND STORAGE Line Per Book No. Month\ Year Ending Amount Adjustments Adjusted Amount (a) (b) (c) (d)- (b)+ (c) 19 WTX General Office {Div 1}: 2 December31, , , January 31, 218 4,19-4,19 22 February 28, , , March 31, ,21 143,21 24 April 3, , , May 31, ,5 167,5 26 June 3, ,28-179,28 27 July 31, , , August 31,218 26,594 26, September 3, , ,281 3 October 31,218 22,96-22,96 31 November 3, , , December31, ,59 736, Month Average 226, , Total WestTexas System at December31, 218 (Ln 15 + Ln 32) Total West Texas System 13-Month Average (Ln 17 + Ln 34) 39 Allocation Factor (e) 95.66% 95.66% 95.66% 95.66% 95.66% 95.66% 95.66% 95.66% 95.66% 95.66% 95.66% 95.66% 95.66% Allocated Amount (f)- (d)* (e) 18, ,723 7, , ,7 159,81 171, , , ,255 21, ,824 74, ,9 672, ,16 WP_B-3 Page 2 of 3

42 MATERIALS & SUPPLIES & UNDERGROUND STORAGE TEST YEAR ENDING DECEMBER 31,218 Line Per Book No. MonthlY ear Ending Amount Adjustments Adjusted Amount (a) (b) (c) (d)- (b)+ (c) 4 Underground Storage- Acct 164.1: 41 West Texas Direct: 42 December 31,217 9,897,616 9,897, January 31,218 5,346,849 5,346, February 28, 218 9,897,616 9,897, March 31,218 59,152 59, April 3, 218 2,56,334-2,56, May 31,218 3,572,341-3,572, June 3, 218 3,879,24 3,879,24 49 July 31,218 5,196,542 5,196,542 5 August 31, 218 6,224,665 6,224, September 3, 218 7,135,311 7,135, October 31, 218 7,665,784-7,665, November 3, 218 6,931,963-6,931, December 31,218 5,297,94 5,297, Month Average 5,77,347 5,77,347 Allocation Factor (e) 1.% 1.% 1.% 1.% 1.% 1.% 1.% 1.% 1.% 1.% 1.% 1.% 1.% Allocated Amount (f)- (d)* (e) 9,897,616 5,346,849 9,897,616 59,152 2,56,334 3,572,341 3,879,24 5,196,542 6,224,665 7,135,311 7,665,784 6,931,963 5,297,94 5,77,347 WP_B-3 Page 3 of 3

43 PREPAYMENTS Line Per Book No. MonthlY ear Ending Amount Adjustments (1) Adjusted Amount (a) (b) (c) (d)- (b)+ (c) Allocation Factor (e) Allocated Amount (f)- (d)* (e) 1 Prepayments - Acct. 165: 2 West Texas Direct: 3 December 31,217-4 January 31, February 28, March 31, April 3, May 31, June 3, ,689 (51,689) - 1 July 31,218 51,689 (51,689) 11 August31,218 51,689 (51,689) September 3, ,689 (51,689) 13 October 31,218 15,917 (15,917) - 14 November 3, December31, Month Average 17,9 (17,9) 18 1.% 1.% 1.% 1.% 1.% 1.% 1.% 1.% 1.% 1.% 1.% 1.% 1.% WP_B-4 Page 1 of4

44 PREPAYMENTS TEST YEAR ENDING DECEMBER 31,218 Line Per Book No. Month\ Year Ending Amount Adjustments (1) Adjusted Amount (a) (b) (c) (d)- (b)+ (c) 19 WTX General Office (Div 1 }: 2 December31, 217 8,527-8, January 31,218 (327,67) (327,67) 22 February 28, ,91 32,91 23 March 31, April 3, 218 1,85,46-1,85,46 25 May31, ,833 (51,689) 56, June 3, ,882-34, July 31,218 5,4 5,4 28 August 31, , , September 3, ,523-73,523 3 October31, ,131 45, November 3, , , December31, ,65-56, Month Average 26,46 (3,976) 256,7 35 Allocation Factor (e) 95.66% 95.66% 95.66% 95.66% 95.66% 95.66% 95.66% 95.66% 95.66% 95.66% 95.66% 95.66% 95.66% Allocated Amount (f)- (d)* (e) 8,157 (313,451) 288,982 1,38,36 535,837 33, ,786 35,948 7,332 43, ,395 54, ,958 WP_B-4 Page 2 of 4

45 PREPAYMENTS Line Per Book No. MonthlY ear Ending Amount Adjustments (1) Adjusted Amount (a) (b) (c) (d)- (b)+ (c) 36 SSU General Office {Div 2}: 37 December 31, ,616,696 32,616, January 31,218 29,49,988 29,49, February 28, ,1,1 27,1,1 4 March 31,218 31,683,436 31,683, April 3, ,925,56 28,925,56 42 May 31, 218 3,949,34 3,949,34 43 June 3, ,221,211 33,221, July 31,218 32,211,59 32,211,59 45 August 31,218 27,91,272 27,91, September 3, ,273,928 25,273, October31, ,55,98 44,55,98 48 November 3, ,73,994 43,73, December 31, 218 4,885,63 4,885, Month Average 32,94,426 32,94, Allocation Factor (e) 7.33% 7.33% 7.33% 7.33% 7.33% 7.33% 7.33% 7.33% 7.33% 7.33% 7.33% 7.33% 7.33% Allocated Amount (f)- (d)* (e) 2,39,22 2,16,983 1,979,193 2,321,636 2,119,546 2,267,842 2,434,318 2,36,299 2,45,154 1,851,973 3,261,222 3,156,291 2,995,895 2,411,16 WP_B-4 Page 3 of 4

46 PREPAYMENTS TEST YEAR ENDING DECEMBER 31,218 Line Per Book No. MonthlY ear Ending Amount Adjustments (1) Adjusted Amount (a) (b) (c) (d)- (b)+ (c) 53 SSU Customer SUJl)lOrt (Div }: 54 December 31, 217 2,236,616 2,236, January 31,218 2,9,732-2,9, February 28, 218 2,634,281 2,634, March 31,218 2,282,619 2,282, April 3, 218 1,999,457 1,999, May 31, 218 1,722,829-1,722,829 6 June 3, 218 1,536,75 1,536,75 61 July 31,218 1,567,298 1,567, August 31, 218 1,47,699-1,47, September 3, '158,64 1 '158,64 64 October31, 218 2,846,625 2,846, November 3, 218 2,66,543-2,66, December 31, 218 2,256,765 2,256, Month Average 2,94,63 2,94, December 31, 218 Total (Ln 15 + Ln 32 + Ln 49 + Ln 66) Month Average Total (Ln 17 + Ln 34 + Ln 51 + Ln 68) Note: The Company has voluntarily removed these amounts to reduce controversy. Allocation Factor (e) 9.62% 9.62% 9.62% 9.62% 9.62% 9.62% 9.62% 9.62% 9.62% 9.62% 9.62% 9.62% 9.62% Allocated Amount (f)- (d)* (e) 215,184 28, , ,61 192, , ,85 15, , , , ,97 217,2 21,469 3,267,29 2,857,532 WP_B-4 Page 4 of 4

47 CUSTOMER DEPOSITS AND CUSTOMER ADVANCES FOR CONSTRUCTION TEST YEAR ENDING DECEMBER 31,218 Line No. MonthlY ear Ending Amount (a) (b) West Texas Direct: Customer Deposits - Acct 235 December 31, 217 2,956,777 January 31,218 2,944,946 February 28, 218 2,948,619 March 31, 218 2,943,633 April 3, 218 2,949,351 May 31,218 2,935,346 June 3, 218 2,78,852 July 31,218 2,749,568 August 31, 218 2,731,519 September 3, 218 2,78,475 October 31, 218 2,715,85 November 3, 218 2,729,16 December 31, 218 2,733, West Texas Direct: Customer Advances - Acct 252 December 31, 217 January 31, 218 February 28, 218 March 31, 218 April 3, 218 May 31,218 June 3, 218 July 31, 218 August 31, 218 September 3, 218 October 31, 218 November 3, 218 December 31, 218 WP_B-5 Page 1 of 1

48 ACCUMULATED DEFERRED INCOME TAXES ("AD IT") (1) (2) Line No Assets I Assets I (Liabilities)- (Liabilities)- DescriptiQD_ Reference Per Book Balances A_Qjy_ Jments (3) Adjusted Balances (a) (b) (c) (d) (e)~ (c)+ (d) West Texas Direct: MIP I VPP Accrual (9,535) (9,535) Worker's Camp Insurance Reserve 16,469 16,469 FAS 16Adjustment CWIP (94,559) 94,559 RWIP (387, 156) (387, 156} Fixed Asset Cost Adjustment (88,4,75} (88,4, 75} Depreciation Adjustment (29,648,649} (29,648,649} Section 481(a} TPR (84,379} (84,379} Deferred Gas Costs 749,26 (749,26} Over Recoveries of PGA (3,229,546} 3,229,546 Customer Advances 1 1 Deferred Expense Projects (7} (7} Capitalized Selling Expense 11,83 11,83 Allowance for Doubtful Accounts 214,649 (214,649} Charitable Contribution Carryover 43,286 (43,286} Prepayments Rate Case Accrual 786,238 (786,238} TX Rule 8.29 Reg Asset Deferral (3, 158,623} (3, 158,623} Intra Period Tax Allocation 26,379 (26,379} Regulatory Liability- Atmos 19 (1} (1} Regulatory Liability- 217 Gross Up 13,357,465 (37,649),986,816 Total West Texas Direct Sum Ln 2 through Ln 22 (19,411,7} 1 '133,698 (18,278,2} WP_B-6 Page 1 of 5

49 ACCUMULATED DEFERRED INCOME TAXES ("ADIT'') (1) (2) Line No. Assets I (Liabilities)- Descri~tion Reference Per Book Balances (a) (b) (c) Adjustments (3) (d) Assets I (Liabilities)- Adjusted Balances (e)- (c)+ (d) WTX General Office {Div 1 ): Ad Valorum Taxes (186,931) MIP /VPP Accrual 11,652 Self Insurance -Adjustment Vacation Accrual Worker's Camp Insurance Reserve 76,156 SEBP Adjustment 377,173 FAS 16 Adjustment 6,1,657 CWIP 9,289 RWIP (26) Fixed Asset Cost Adjustment (631,688) Depreciation Adjustment (85,83) Section 481 (a) TPR (3) Deferred Gas Costs Over Recoveries of PGA Customer Advances Deferred Expense Projects (11,898) Capitalized Selling Expense UN I CAP Section 263A Costs 6, (a) UNICAP Allowance for Doubtful Accounts 3,181 Clearing Account- Adjustment Charitable Contribution Carryover Prepayments (53,2) Rate Case Accrual (793,782) WACOG to FIFO Adjustment (26,873) Reg Asset Benefit Accrual TX Rule 8.29 Reg Asset Deferral Intra Period Tax Allocation 2,654 Regulatory Liability- Atmos 19 Total WTX General Office Sum Ln 26 through Ln 54 4,953,232 West Texas Allocation Factor 95.66% Total Allocated WTX General Office Ln 55 times Ln 56 4,738,292 Total West Texas Direct Ln23+Ln57 (14,673,48) (9,289) (6,686) (3,181) 793,782 (2,654) (186,931) 11,652 76, ,173 6,1,657 (26) (631,688) (85,83) (3) (11,898) (53,2) (26,873) 66,972 5,56, % 95.66% 58,633 5,318,925 1,714,332 (12,959,76) WP_B-6 Page 2 of 5

50 WEST TEXAS CITIES (''WTX CITIES") RATE REVIEW MECHANISM ACCUMULATED DEFERRED INCOME TAXES ("ADIT") (1) (2) TEST YEAR ENDING DECEMBER 31,218 Line No Assets I Assets I (Liabilities)- (Liabilities)- Description Reference Per Book Balances Adjustments (3) Adjusted Balances (a) (b) (c) (d) (e)= (c)+ (d) SSU Customer Su~~ort {Div ): MIP I VPP Accrual (1,189,274) (1,189,274) Vacation Accrual Worker's Camp Insurance Reserve FAS 16 Adjustment CWIP (627,317) 627,317 RWIP (86) (86) Fixed Asset Cost Adjustment (24,668, 118) (24,668, 118) Depreciation Adjustment 8,294,43 8,294,43 Clearing Account- Adjustment Charitable Contribution Carryover Prepayments (67,56) (67,56) Intra Period Tax Allocation 18,398 (18,398) Total SSU Customer Support Sum Ln 62 through Ln 73 (18,779,188) 68,919 (18,17,269) Allocation Factor 9.62% 9.62% 9.62% Total Allocated SSU Customer Support Ln 74 times Ln 75...! (1,86,736) 58,584 (1,748,153) WP_B-6 Page 3 of 5

51 ACCUMULATED DEFERRED INCOME TAXES ("ADIT") (1) (2) Assets I Assets I Line (Liabilities)- (Liabilities)- No. Description Reference Per Book Balances Adjustments (3) Adjusted Balances (a) (b) (c) (d) (e)= (c)+ (d) 78 SSU General Office (Div 2): 79 Directors Deferred Bonus 8 MIP I VPP Accrual 81 Miscellaneous Accrued 82 Self Insurance -Adjustment 83 Vacation Accrual Worker's Camp Insurance Reserve SEBP Adjustment Restricted Stock Grant Plan Rabbi Trust Restricted Stock- MIP Director's Stock Awards Pension Expense FAS 16 Adjustment CWIP RWIP Fixed Asset Cost Adjustment Deprec 1af1on Adjustment Section 481(a) Cushion Gas Section 481(a) Line Pack Gas Deferred Expense Projects Allowance for Doubtful Accounts Clearing Account- Adjustment Charitable Contribution Carryover Prepayments Stock Option Expense Federal & State Tax Interest VA Charitable Contributions Intra Period Tax Allocation Regulatory Liability- Atmos 19 FD- NOL Credit Carryforward - Non Reg FD- NOL Credit Carryforward - Utility FD - NOL Credit Carryforward - Other FD- FAS 115 Adjustment FD- AMT Minimum Tax Credit STM Valuation Allow Enterprise Zone ltc 132,627 2,93, ,897,798 72,558 16,499,573 1,229 91,834 9,45,594 4,477,825 (6,494,865) 5,881,243 (2,38,243) (2,367) (23,91,76) 6,38, ,37 41,663 5,29,3 (5,436,598) 772,634 (67, 1) (16,946,626) 617,72,455 5,52,949 (2,466,33) (,928) 132,627 2,93, (2,897,798) 2,38,243 (343,37) (41,663) (1) (5,29,3) 16,946,626 (5,52,949),928 72,558 16,499,573 1,229 91,834 9,45,594 4,477,825 (6,494,865) 5,881,243 (2,367) (23,91,76) 6,38,331 (5,436,598) 772,634 (67,1) 617,72,455 (2,466,33) WP_B-6 Page 4 of 5

52 ACCUMULATED DEFERRED INCOME TAXES ("ADIT") (1) (2) Assets I Assets I Line (Liabilities)- (Liabilities)- No. Description Reference Per Book Balances Adjustments (3) Adjusted Balances (a) (b) (c) (d) (e)= (c)+ (d) 114 FD- Valuation Allow Fed Tax Enterprise Zone ltc 115 ST- Enterprise Zone ltc 116 FD -Treasury Lock Adjustment- Realized 117 FD -Treasury Lock Adjustment- Unrealized 118 FD- Federal Tax on Enterprise ltc 119 Total SSU General Office Allocation Factor 1 Total Allocated SSU General Office 2 3 Total Allocated SSU ADIT to West Texas 4 5 Grand Total West Texas ADIT 6 7 Notes: 8 1. Includes FERC Accounts 19, 282 and Credit amounts are in parentheses Adjustments are for those items not included in rate base for ratemaking purposes. 25,395 (25,395) 1,933,673 (1,933,673) 2, ,76,455 (,76,455) (46,71) 46,71 I':!.'(.'( nn A 1"\r=.t"'\ --- "16,252 Sum Ln 79 through Ln , 1 1,uu:':: ~~-.p 1.,;1...,., 1 r.v.57o I..53% 'Y"1.A.A A <::r'l Ln 119 times Ln VI,...,...,._,u 'I',.., v,<.jj "'71,_472 Ln76+Ln1 35,637,613 9,93,56 Ln 59+ Ln 3 (69,35, 795) 11,644,388 2,954, ,72, % 47,315,822 45,567,669 (57,391,47) WP_B-6 Page 5 of 5

53 AMORTIZATION OF REGULATORY LIABILITY Line No Beginning of Year End of Year Rate Base Rate Base Year Ended Adjustment Annual Adjustment Dec. 31 Amount (1) Amortization (2) Amount (a) (b) (c) (d) ,839,618 58,839, ,839,618 2,451,651 56,387, ,387,967 2,451,651 53,936, ,936,317 2,451,651 51,484, ,484,666 2,451,651 49,33, ,33,15 2,451,651 46,581, ,581,364 2,451,651 44,9, ,9,714 2,451,651 41,678, ,678,63 2,451,651 39,226, ,226,4 2,451,651 36,774, ,774,761 2,451,651 34,323, ,323,111 2,451,651 31,871, ,871,46 2,451,651 29,419, ,419,89 2,451,651 26,968, ,968,158 2,451,651 24,516, ,516,58 2,451,651 22,64, ,64,857 2,451,651 19,613, ,613,26 2,451,651 17,161, ,161,555 2,451,651 14,79, ,79,95 2,451,651,258, ,258,254 2,451,651 9,86, ,86,63 2,451,651 7,354, ,354,952 2,451,651 4,93, ,93,32 2,451,651 2,451, ,451,651 2,451,651 Notes: 1. The beginning 218 balance is as of September 3, 218. The regulatory liability for excess deferred taxes is an estimate and will be finalized when the Company files its federal tax return in July 219. To the extent that this estimate changes with the filing of the Company's tax return, the Company will"true-up" the amount in the 22 RRM filing. 2. The annual amortization of a 24 year recovery period is based on the Reverse South Georgia Method. 3. The Regulatory Liability is recorded to FERC Account 253, Sub Acct WP_B-6.1 Page 1 of 1

54 MIDPOINT OF REGULATORY LIABILITY TEST YEAR ENDING DECEMBER 31,218 Line No End of Month Rate Base Beginning Month Monthly Adjustment Month Balance Amortization Amount (a) (b) (c) (d) October-18 58,839,618 24,34 58,635,314 November-18 58,635,314 24,34 58,431,1 December-18 58,431,1 24,34 58,226,76 January-19 58,226,76 24,34 58,22,41 February-19 58,22,41 24,34 57,818,97 March-19 57,818,97 24,34 57,613,793 April-19 57,613,793 24,34 57,49,489 May-19 57,49,489 24,34 57,25,184 June-19 57,25,184 24,34 57,,88 July-19 57,,88 24,34 56,796,576 August-19 56,796,576 24,34 56,592,272 September-19 56,592,272 24,34 56,387,967 October-19 56,387,967 24,34 56,183,663 November-19 56,183,663 24,34 55,979,359 December-19 55,979,359 24,34 55,775,55 January-2 55,775,55 24,34 55,57,751 February-2 55,57,751 24,34 55,366,446 March-2 55,366,446 24,34 55,162,142 April-2 55,162,142 24,34 54,957,838 May-2 54,957,838 24,34 54,753,534 June-2 54,753,534 24,34 54,549,229 July-2 54,549,229 24,34 54,344,925 August-2 54,344,925 24,34 54,14,621 September-2 54,14,621 24,34 53,936,317 October-2 53,936,317 24,34 53,732, November-2 53,732, 24,34 53,527,78 December-2 53,527,78 24,34 53,323,44 WP_B-6.2 Page 1 of 1

55 PENSION AND OTHER POST EMPLOYMENT BENEFITS REGULATORY ASSET/LIABILITY Line No. Description (a) Amounts (b) 1 Summarization of Pension and Other Postemployment Benefits Regulatory Asset/Liability: Pension Asset/Liability at December 218 Total Pension and Other Postemployment Benefits Regulatory Asset/Liability (Line 3) Summarization of Pension and Other Postemployment Benefits Asset/Liability Amortization: Pension Asset/Liability Amortization- Calculated (Pension Asset/Liability Amount/1 years) (1) Pension Asset/Liability Amortization- Per Book Amount from January 1, 218 through the end of the Test Year Pension Asset/Liability Amortization Adjustment (Line 9 plus Line 11) (2) (3) (3,842, 72) (3,842, 72) (384,27) (72,977) (457,247) Notes: The annual recorded amortization of the Pension and Other Postemployment Benefits Regulatory Asset/Liability cost is included in O&M The adjustment to Pension Asset/Liability Amortization is shown on WP _F The current year asset/liability balance includes both a capital and expense component. The Company plans to continue the amortization of 19 the existing deferred amounts through the end of the amortization period. Future additions or reductions to the deferral will be expense only amounts. The capital component will be recorded to utility plant through the overhead process. WP_B-7 Page 1 of 1

56 PENSION AND OTHER POST EMPLOYMENT BENEFITS REGULATORY ASSET/LIABILITY SUMMARY TEST YEAR ENDING DECEMBER 31,218 Line No. Time Period (a) Description (b) Amount Per Period (c) Total Amount (d) Total Assetlliabilitv Amount- By Period C1): October 1, 2- June 3, 213 July 1, 213- September 3, 213 October 1, 213- March 31, 214 April1, 214- September 3, 214 October 1, 214- March 14, 215 March 15, 215- September 3, 215 October 1, March 14, 216 March 15, 216- September 3, 216 October 1, March 14, 217 March 15,217- September 3,217 October 1, 217- December 31, 217 January 1, 218- September 3, 218 October 1, 218- December 31, 218 Total Asset/Liability Amortization- By Period (2): October 1, 2- September 3, 213 October 1, 213- September 3, 214 October 1, 214- September 3, 215 October 1, 215- September 3, 216 October 1, 216- December31, 217 January 1, 218- December 31, 218 This asset/liability was approved in the 213 WTX Statement of Intent (TME June 3, 213) and represents the difference betvveen the GUD No benchmark and the FY13 Towers Watson Actuarial Report. This asset/liability amount represents the difference betvveen the GUO No benchmark and the FY13 Towers Watson Actuarial Report. This assetlliability amount represents the difference betvveen the GUO No benchmark and the FY14 Towers Watson Actuarial Report. This asset/liability amount represents the difference betvveen the 213 WTX Statement of Intent (TME June 3, 213) benchmark and the FY14 Towers Watson Actuarial Report. This asset/liability amount represents the difference betvveen the 213 WTX Statement of Intent (TME June 3, 213) benchmark and the FY15 Towers Watson Actuarial Report. This asset/liability amount represents the difference betvveen the 214 WTX Cities RRM Settlement benchmark and the FY15 Towers Watson Actuarial Report. This asset/liability amount represents the difference betvveen the 214 WTX Cities RRM Settlement benchmark and the FY16 Towers Watson Actuarial Report. This asset/liability amount represents the difference betvveen the 215 WTX Cities RRM Settlement benchmark and the FY16 Towers Watson Actuarial Report. This asset/liability amount represents the difference betvveen the 215 WTX Cities RRM Settlement benchmark and the FY17 Towers Watson Actuarial Report. This asset/liability amount represents the difference betvveen the 216 WTX Cities RRM Settlement benchmark and the FY17 Towers Watson Actuarial Report. This asset/liability amount represents the difference betvveen the 216 WTX Cities RRM Settlement benchmark and the FY18 Towers Watson Actuarial Report. This asset/liability amount represents the difference between the 216 WTX Cities RRM Settlement benchmark and the FY18 Towers Watson Actuarial Report. This asset/liability amount represents the difference between the 217 WTX Cities RRM Settlement benchmark and the FY19 Towers Watson Actuarial Report. Total Asset/Liability Values at December 31, 218 (Sum of Ln 3 through Ln 15) No amortization was recorded in Fiscal Year 213 Amortization recorded in Fiscal Year 214 Amortization recorded in Fiscal Year 215 Amortization recorded in Fiscal Year 216 Amortization recorded for 15 months through Calendar Year 217 Amortization recorded in Calendar Year 218 Total Asset/Liability Amortization at December 31, 218 (Sum of Ln 21 through Ln 26) Net Asset/Liability Amount at December 31, 218 (Ln 17 + Ln 28) 32 Notes: The Company has included in rate base, as a regulatory asset/liability, the Company's calculation of the Pension and Other Postemployment Benefits cost in accordance with 34 TEX. UTILITIES CODE, SECTION The annual amortization of the Pension and Other Postemployment Benefits Regulatory Asset/Liability cost is included in O&M expense on Schedule F-1. The annual amortization 36 is based on a ten year amortization period. 1,183,77 394, ,652 (13,644) (323,257) (382,3) (822,388) (551,373) (56,661) (67,23) (446,814) (1,419,599) (525,634) (59,185) (133,594) (8,948) (1,44) (72,977) (3,842,72) (57,144} (4,349,846) WP _B-7.1 Page 1 of 1

57 WEST TEXAS CITIES {"WTX CITIES") RATE REVIEW MECHANISM COMPONENTS OF RATE BASE- GROSS PLANT Line Utility Per Books No. Account Account Description Reference Plant Balance {a) {b) (c) {d) Adjustments {1) (e) Adjusted Plant Balance (f)- (d)+ (e) 1 West Texas Direct: 2 Distribution Plant Land 47, Land Rights 255, Structures & Improvements 321, Structures - Frame 6, Structures - Land Rights 2, Improvements 23, Mains - Cathodic Protection 55,821, Mains - Steel 146,14, Mains - Plastic 274,15, Compressor Station Equipment 217, M&R Station Equipment- General 2,173, M&R Station Equipment - City Gate 9,58, Services 15,14, Meters 63,564, Meter installations 59,795, House Regulators,75, House Regulator Installations 1 '168, Industrial M&R Station Equipment 2,298, Other Property on Customers' Premises 24, Other Equipment 1,593,57 23 Total Distribution Plant Sum Ln 3 through Ln ,167, ,736 2,146,817 5,382, ,714 7,85 1,33,978 1 '1 5, , ,9 8,33 11,427,425 47, ,61 321,35 6,154 2,74 23,347 56,85,6 148,251,73 279,532, ,93 2,369,369 9,65,16 151,48,98 64,67,173 6,662,932,221,521 1 '168,266 2,37,22 24,218 1,593,57 88,595,18 Schedule C Page 1 of7

58 COMPONENTS OF RATE BASE- GROSS PLANT Line Utility Per Books No. Account Account Description Reference Plant Balance (a) (b) (c) (d) 25 General Plant Franchises & Consents 4, Land & Land Rights 1,993, Structures & Improvements 8,675, Structures - Frame 5,867, Structures - Brick 2,629, Improvements 74, Air Conditioning Equipment 52, lmprovments to Leased Premises 1,776, Office Furniture & Equipment 1,716, Transportation Equipment 273, Stores Equipment 14, Tools, Shop, and Garage Equipment 6,919, Laboratory Equipment Power Operated Equipment 885, Ditchers 4, Backhoes 111, Welders 34, Communication Equipment 3, Telemetering Equipment 32, Miscellaneous Equipment 6,372, Servers Hardware PC Hardware 2,558, PC Software 161, Total General Plant Sum Ln 26 through Ln 48 4,99,489 5 Adjustments (1) (e) (44,63) (31,22) (75,625) Adjusted Plant Balance (f) - (d) + (e) 4,264 1,993,192 8,63,519 5,867,18 2,629,111 74,96 52,92 1,776,97 1,685, ,46 14,29 6,919, ,5 4, ,262 34,65 3,78 32,265 6,372,848 2,558, ,117 4,833,864 Schedule C Page 2 of 7

59 COMPONENTS OF RATE BASE- GROSS PLANT Line Utility Per Books No. Account Account Description Reference Plant Balance (a) (b) (c) (d) Adjustments (1) (e) Adjusted Plant Balance (f) - (d)+ (e) 51 WTX General Office (Div 1 Ol: 52 General Plant Land & Land Rights 516, Structures & Improvements 4,892, Office Furniture & Equipment 721, Transportation Equipment 45, Tools, Shop, and Garage Equipment 51, Communication Equipment 259, Mobile Radios 34, Fixed Radios Telemetering Equipment 9, Miscellaneous Equipment 1,399, Servers Hardware 2, Network Hardware 143, PC Hardware 4,261, PC Software 59, Total WTX General Office Sum Ln 53 through Ln 66 13,317, Allocation Factor 95.66% 69 Total Allocated WTX General Office Ln 67 times Ln 68,739, Total West Texas Ln 23 + Ln 49 + Ln 69 85,816, (68,) (131,732) (1 3,216) (32,947) 95.66% (289,81) 11,61, ,818 4,824,58 589,941 45, ,41 259,282 34,247 9,61 1,399,849 2, ,993 4,261,363 59,624 13,14, %,449, ,878,833 Schedule C Page 3 of?

60 COMPONENTS OF RATE BASE- GROSS PLANT Line Utility Per Books No. Account Account Description Reference Plant Balance (a) (b) (c) (d) Adjustments (1) (e) Adjusted Plant Balance (f)= (d)+ (e) 73 SSU General Office (Div 2): 74 General Plant Structures & Improvements 1,411, Improvements to Leased Premises 9,437, Office Furniture & Equipment 5,436, Transportation Equipment 7, Tools, Shop, and Garage Equipment 76,71 so 397. Communication Equipment 1,39, Miscellaneous Equipment 136, Other Tangible Property 162, Servers Hardware 2,472, Servers Software 16,988, Network Hardware 4,732, PC Hardware 2,29, PC Software 1,487, Application Software 71,25, System Software 39,252 9 Total SSU General Office Sum Ln 75 through Ln ,922, Allocation Factor 7.33% 92 Total Allocated SSU General Office Ln 9 times Ln 91 9,886, SSU Greenville Data Center (Div 2): 95 General Plant Structures & Improvements 9,187, Office Furniture & Equipment 71,36 98 Total SSU Greenville Data Center Sum Ln 96 through Ln 97 9,258, Allocation Factor 2.78% 1 Total Allocated SSU Greenville Data Center Ln 98 times Ln , (63,26) (56,463) (857,853) (1,967,522) 7.33% (144,172) " 2.78% " 1,411,39 8,834,213 4,929,794 7,5 76,71 1,39, ,51 162,268 2,472,393 16,988,29 4,732,587 2,29,495 1,487,686 7,347,832 39, ,955, % 9,742,427 9,187,142 71,36 9,258, % 256,928 Schedule C Page4 of?

61 COMPONENTS OF RATE BASE- GROSS PLANT Line Utility Per Books No. Account Account Description Reference Plant Balance (a) (b) (c) (d) Adjustments (1) (e) Adjusted Plant Balance (f) - (d)+ (e) 12 SSU Distribution & Marketina (Div 2): 13 General Plant Structures & Improvements 2, Improvements to Leased Premises 1, Office Furniture & Equipment 263, Tools, Shop, and Garage Equipment Communication Equipment 8, Miscellaneous Equipment 7, Servers Hardware 1,63, Servers Software 1,461, Network Hardware 22, PC Hardware 314, Application Software 2,681, Total SSU Distribution & Marketing Sum Ln 14 through Ln ,826, Allocation Factor 9.26% 117 Total Allocated SSU Distribution & Marketing Ln 115 times Ln 116 2,26, SSU Aligne Pipe Proiect (Div 2): General Plant Servers Hardware 297, Servers Software 345, Application Software 19,553,37 4 Total SSU Aligne Pipe Project Sum Ln 1 through Ln 3 2,196,367 5 Allocation Factor.% 6 Total Allocated SSU Aligne Pipe Project Ln 4 times Ln Total SSU General Office (Div 2) Ln 92 + Ln 1 + Ln Ln 6,349,818 9 (75,271) (75,271) 9.26%.. (6,97).% (151,142) 2,116 1, ,67 8,824 7,388 1,63,473 1,461,672 22,25 314,379 2,681,36 23,75, % 2,199, , ,73 19,553,37 2,196,367.%,198,676 Schedule C Page 5 of7

62 COMPONENTS OF RATE BASE- GROSS PLANT Line Utility Per Books No. Account Account Description Reference Plant Balance (a) (b) (c) (d) Adjustments (1) (e) Adjusted Plant Balance (f) - (d) +(e) 13 SSU Customer Support (Div ): 131 General Plant Land & Land Rights 2,874, Structures & Improvements,731, Improvements to Leased Premises 2,82, Office Furniture & Equipment 2,395, Communication Equipment 1,913, Miscellaneous Equipment 7, Other Tangible Property Servers Hardware 9,75, Servers Software 2,21, Network Hardware 629, PC Hardware 614, PC Software Application Software 95,48, Total SSU Customer Support Sum Ln 132 through Ln ,58, Allocation Factor 9.62% 147 Total Allocated SSU Customer Support Ln 145 times Ln 146,69, (7,868) (53,348) (61,215) 9.62% (5,889) 2,874,24,731,367 2,8,746 2,341,835 1,913,117 7,16 9,75,723 2,21, , ,382 95,48,384 13,996, %,63,144 Schedule C Page 6 of?

63 COMPONENTS OF RATE BASE- GROSS PLANT Line No. Utility Per Books Account Account Description Reference Plant Balance (a) (b) (c) (d) Adjustments (1) (e) Adjusted Plant Balance (!) - (d) +(e) SSU CKV Trainina Center!Div ): General Plant Land & Land Rights 1,886, Structures & Improvements,55, Office Furniture & Equipment 467, Transportation Equipment 96, Tools, Shop, and Garage Equipment 517, Laboratory Equipment 23, Communication Equipment 291, Miscellaneous Equipment 526, Other Tangible Property 378, PC Hardware 69, PC Software 3, Application Software Total SSU CKV Training Center Sum Ln 151 through Ln ,765,864 Allocation Factor 5.5% Total Allocated SSU CKV Training Center Ln 163 times Ln ,466 Total SSU Customer Support (Div ) Ln Ln ,53,499 Total Allocated SSU Plant to West Texas Ln 8 + Ln ,88,317 Total WTX System Gross Plant Ln 71 + Ln ,697,151 1,886,443,55, ,519 96,29 517,754 23, ,51 526, ,333 69,28 3,299 16,765, % 5.5% 921, (5,889) 13,524,69 (157~32) 25,723,285 1Q,_94, ,62,118 Note: 1. Please see relied file, "Schedule C&D- Net Plant with Adjustments.xlsx" for details related to adjustments shown in Col (e). The adjustments include removal of projects previously disallowed and other known and measurable adjustments to gross plant. Schedule C Page 7 of?

64 COMPONENTS OF RATE BASE- ACCUMULATED DEPRECIATION Per Books Line Utility Accumulated No. Account Account Description Reference De!;!reciation (a) (b) (c) (d) 1 West Texas Direct: 2 Distribution Plant Land Land Rights 148, Structures & Improvements 217, Structures- Frame 6, Structures - Land Rights 2, Improvements 23, Mains - Cathodic Protection 19,389, Mains - Steel 3,681, Mains - Plastic 38,79, Compressor Station Equipment 217, M&R Station Equipment- General 3,999, M&R Station Equipment- City Gate 58, Services 45,791, Meters 17,384, Meter installations (1,639,697) House Regulators 3,475, House Regulator Installations 1,341, Industrial M&R Station Equipment 1,673, Other Property on Customers' Premises 24, Other Equipment 831, Total Distribution Plant Sum Ln 3 through Ln ,939, Adjustments (1) (e) Adjusted Accumulated Depreciation (f) = (d) +(e) 148, ,181 6,154 2,74 23,347 19,389,672 3,681,452 38,79, ,93 3,999,351 58,98 45,791,641 17,384,452 (1,639,697) 3,475,76 1,341,8 1,673,913 24, , ,939,576 ScheduleD Page 1 of 7

65 COMPONENTS OF RATE BASE-ACCUMULATED DEPRECIATION Per Books Line Utility Accumulated No. Account Account Description Reference Depreciation (a) (b) (c) (d) 25 General Plant Franchises & Consents 1, Land & Land Rights (1,225) Structures & Improvements 1,479, Structures - Frame 889, Structures - Brick 824, Improvements 164, Air Conditioning Equipment 4, lmprovments to Leased Premises 1,373, Office Furniture & Equipment 854, Transportation Equipment (47,874) Stores Equipment 1, Tools, Shop, and Garage Equipment 1,926, Laboratory Equipment Power Operated Equipment 619, Ditchers Backhoes 85, Welders 27, Communication Equipment 21, Telemetering Equipment 6, Miscellaneous Equipment 2,433, Servers Hardware (546) PC Hardware 2,558, PC Software 161, RWIP Retirement Work in Progress (1,411,558) 5 Total General Plant Sum Ln 26 through Ln 49,7, Adjustments (1) (e) (3,78) (5,441) (9,221) Adjusted Accumulated Depreciation (f) - (d) +(e) 1,474 (1,225) 1,475,61 889, , ,169 4,75 1,373, ,657 (47,874) 1,552 1,926, , ,166 27,758 21,913 6,292 2,433,251 (546) 2,558, ,117 (1,411,558) 11,998,71 ScheduleD Page 2 of 7

66 COMPONENTS OF RATE BASE ACCUMULATED DEPRECIATION Line No. Utility Account (a) Per Books Accumulated Account Descri[!tion Reference Depreciation (b) (c) (d) Adiustments (1) (e) Adjusted Accumulated Depreciation (f) - (d) + (e) WTX General Office (Div 1 ): General Plant 389. Land & Land Rights 39. Structures & Improvements 643, Office Furniture & Equipment 197, Transportation Equipment 18, Tools, Shop, and Garage Equipment 43, Communication Equipment 164, Mobile Radios 24, Fixed Radios Telemetering Equipment 3, Miscellaneous Equipment 565, Servers Hardware (31,51) Network Hardware 56, PC Hardware 1,5, PC Software 44,98 RWIP Retirement Work in Progress 49,635 Total WTX General Office Sum Ln 54 through Ln 68 3,33,579 Allocation Factor 95.66% Total Allocated WTX General Office Ln 69 times Ln 7 3,16,224 Total West Texas Ln 23 + Ln 5+ Ln ,17,731 (5,38) (32,517) (6,364) (44, 19) 95.66% (42,272) (51,493) 638, ,982 18,983 37, ,496 24,555 3, ,917 (31,51) 56,848 1,5,431 44,98 49,635 3,259, % 3,117, ,56,237 ScheduleD Page 3 of?

67 COMPONENTS OF RATE BASE- ACCUMULATED DEPRECIATION Per Books Adjusted Line Utility Accumulated Accumulated No. Account Account Description Reference Depreciation Adjustments (1) Depreciation (a) (b) (c) (d) (e) (f)- (d) + (e) 75 SSU General Office (Div 2): 76 General Plant Structures & Improvements 515, , Improvements to Leased Premises 9,43,447 (596,234) 8,834, Office Furniture & Equipment 1,961,326 (8,3) 1,881, Transportation Equipment 5,697 5, Tools, Shop, and Garage Equipment 36,8 36, Communication Equipment 564, , Miscellaneous Equipment 47,197 47, Other Tangible Property 163, , Servers Hardware 4,6,634 4,6, Servers Software 15,679,286 15,679, Network Hardware 2,656,791 2,656, PC Hardware 197, , PC Software 296, , Application Software 31,951,32 (617,954) 31,333, System Software 45,655 45, RWIP Retirement Work in Progress 3,272 3, Total SSU General Office Sum Ln 77 through Ln 92 67,562,445 (1,294,5) 66,267, Allocation Factor 7.33% 7.33% 7.33% 95 Total Allocated SSU General Office Ln 93 times Ln 94 4,95,78 (94,856) 4,855, SSU Greenville Data Center (Div 2): 98 General Plant Structures & Improvements 3,75,275 3,75, Office Furniture & Equipment 32,949 32, Total SSU Greenville Data Center Sum Ln 99 through Ln 1 3,783,223 3,783, Allocation Factor 2.78% 2.78% 2.78% 13 Total Allocated SSU Greenville Data Center Ln 11 times Ln 12 14,99 14,99 14 ScheduleD Page 4 of?

68 COMPONENTS OF RATE BASE- ACCUMULATED DEPRECIATION Per Books Line Utility Accumulated No. Account Account Description Reference Depreciation (a) (b) (c) (d) Adjustments (1) (e) Adjusted Accumulated Depreciation (f)= (d) + (e) 15 SSU Distribution & Marketina IDiv 2): 16 General Plant Structures & Improvements Improvements to Leased Premises Office Furniture & Equipment 17, Tools, Shop, and Garage Equipment Communication Equipment 4, Miscellaneous Equipment Servers Hardware 376, Servers Software 476, Network Hardware 8, PC Hardware 7, Application Software 11,688, Total SSU Distribution & Marketing Sum Ln 17 through Ln 117,732, Allocation Factor 9.26% Total Allocated SSU Distribution & Marketing Ln 118 times Ln 119 1,178, SSU Aligne Pige Project (Div 2): 3 General Plant Servers Hardware 67, Servers Software 64, Application Software 4,15,282 7 Total SSU Aligne Pipe Project Sum Ln 4 through Ln 6 4,237,279 8 Allocation Factor.% 9 Total Allocated SSU Aligne Pipe Project Ln 7 times Ln Total SSU General Office (Div 2) Ln 95 + Ln 13 + Ln + Ln 9 6,234, (2,524) (2,524) 9.26% (1,91).% (96,756) , , , ,59 8,4 7,41 11,688,243,711, % 1,177,92 67,82 64,177 4,15,282 4,237,279.% 6,137,933 ScheduleD Page 5 of 7

69 COMPONENTS OF RATE BASE-ACCUMULATED DEPRECIATION Line No. Utility Account (a) Per Books Accumulated Account Description Reference Depreciation (b) (c) (d) Adjustments (1) (e) Adjusted Accumulated Deereciation (f)= (d) + (e) SSU Customer Suooort (Div ): General Plant 389. Land & Land Rights 39. Structures & Improvements 2,31, Improvements to Leased Premises 1,76, Office Furniture & Equipment 871, Communication Equipment 1,87, Miscellaneous Equipment, Other Tangible Property (154,265) Servers Hardware 4,216, Servers Software 1,232, Network Hardware 377, PC Hardware (4,379) PC Software (57,199) Application Software 31,814,881 RWIP Retirement Work in Progress Total SSU Customer Support Sum Ln 135 through Ln ,99,173 Allocation Factor 9.62% Total Allocated SSU Customer Support Ln 149 times Ln 15 4,146,55 (3, 199) (15,45) (18,245) 9.62% (1,755) 2,31,41 1,73, ,752 1,87, 13,862 (154,265) 4,216,498 1,232, ,897 (4,379) (57, 199) 31,814,881 43,8, % 4,144,795 ScheduleD Page 6 of 7

70 COMPONENTS OF RATE BASE-ACCUMULATED DEPRECIATION Line No. Utility Account (a) Per Books Accumulated Account Description Reference Depreciation (b) (c) (d) Adjustments (1) (e) Adjusted Accumulated Depreciation (f) = (d) +(e) SSU CKV Traininq Center (Div ): General Plant Land & Land Rights 39.1 Structures & Improvements 2,965, Office Furniture & Equipment 49, Transportation Equipment 93, Tools, Shop, and Garage Equipment 6, Laboratory Equipment 16, Communication Equipment 159, Miscellaneous Equipment 141, Other Tangible Property 18, PC Hardware 34, PC Software (28,287) Application Software (9,966) Total SSU CKV Training Center Sum Ln 155 through Ln 166 3,729,84 Allocation Factor 5.5% Total Allocated SSU CKV Training Center Ln 167 times Ln ,995 Total SSU Customer Support (Div ) Ln Ln 169 4,351,545 Total Allocated SSU Accumulated Depreciation Ln Ln 171 1,586,235 Total WTX System Accumulated Depreciation Ln73+Ln ,693,966 2,965,821 49,45 93,986 6,415 16, , ,437 18,472 34,646 (28,287) (9,966) 3,729,84 5.5% 5.5% 24,995 (1,755) 4,349,79 (98,5) 1,487,723 (15,5) 179,543,961 Note: 1. Please see relied file, "Schedule C&D- Net Plant with Adjustments.xlsx" for details related to adjustments shown in Col (e). The adjustments include removal of projects previously disallowed and other known and measurable adjustments to accumulated depreciation. ScheduleD Page 7 of?

71 CASH WORKING CAPITAL Line No. Test Year Avg. Daily Revenue Expense Net Working Capital Description Expenses Reference Expense Lag Lag Lag Requirement (a) (b) (c) (d)-(b)/365 (e) (D (g)-(e)-(d (h)=(d)x(g) Total Gas Supply Expense 82,43,976 Detail Trial Balance 225, (3.11) (72,357) Operation & Maintenance Other O&M - Labor 14,893,53 [1], [2) 4,83 Other O&M - Non-Labor 3,72,1 Ln. 6 minus Ln. 4 84,165 Total Operation & Maintenance 45,613,153 Schedule F-1 Taxes Other Than Income Non-Revenue Related Ad Valorem 7,157,277 Schedule F-5 19,69 Payroll Taxes 581,379 Schedule F-5 1,593 Allocated Taxes -Ad Valorem and Other 227,696 [3) 624 Allocated Taxes - Payroll Taxes 771,33 [4] 2,113 Total Non-Revenue Related Taxes 8,737,682 Sum Ln 1 through Ln 13 Revenue Related Local Franchise Tax 9,481,366 Detail Trial Balance 25,976 State Gas Transportation 17,563 Schedule F-5 48 Total Revenue Related Taxes 9,498,928 Sum Ln 17 through Ln 18 Total Taxes Other Than Income Taxes 18,236,61 Sum of Ln 14 and Ln 19 State Income Tax ("Gross Margin") 1,68,215 Schedule F-6 2,927 Current Federallncome Tax 11,743,22 [5] 32,173 Interest on Customer Deposits 52,482 Schedule F Total Cash Working Capital Requirement 159,144,638 Notes: 1. Includes WTX Division and SSU Labor and WTX Division MIPNPP (excludes SSU MIPNPP). 2. WP_F-2.1, Col (g) Ln21 + WP_F-2.1, Col (c) Ln25 + WP_F-5.1, Col (b) Ln 27 + WTX MlPNPP. 3. Schdule F-5, Col. (d), Ln. 4 plus Schedule F-5, Col. (d), Ln. 5 minus Schedule E, Col. (b), Ln WP _F-5.1, Col (b), Ln 31 plus relied file, "CY18 Detail Trial Balance.xlsx", cell E If (Schedule F-6, Col (b) Ln 1 minus WP _E-1, Col (e) Ln 5 plus WP _8-6, Col {e) Ln 5) is less than zero, then zero will be utilized. 6. Cash Working Capital Revenue and Expense Lags are per the 213 West Texas SO! Cash Working Capital Study (174.96) (174.96) (27.14) (56.19) (46.5) (293.29) 377, ,131 8,558 (3,43,787) 6,451 (19,144) 8,559 (3,524,922) (75,67) (2,74) (77,77) (4,232,692) 248,879 33,46 (42,171) (3,882,322) Schedule E Page 1 of 1

72 BEGINNING BALANCE ACCUMULATED DEFERRED INCOME TAXES (1) (2) Line No. Assets I (Liabilities) Per Book Balances Description Reference at /31/217 Adjustments {3) (a) (b) (c) (d) Assets I (Liabilities) R Adjusted Balances at (e)= (c)+ (d) West Texas Direct: MIP I VPP Accrual (1,36) 1,953 Worker's Camp Insurance Reserve FAS 16 Adjustment CWIP (181,46) 181,46 RWIP (42,689) Fixed Asset Cost Adjustment (73,6,841) Depreciation Adjustment (33,549,148) Section 481(a) TPR (244,48) Deferred Gas Costs 2,456,9 (2,456,9) Over Recoveries of PGA (3,486,25) 3,486,25 Customer Advances 32,937 Deferred Expense Projects (76) Capitalized Selling Expense,654 Allowance for Doubtful Accounts 249,219 (249,219) Charitable Contribution Carryover Prepayments Rate Case Accrual 766,29 (766,29) TX Rule 8.29 Reg Asset Deferral (2,582,915) lmtra Period Tax Allocation Regulatory Liability- Atmos 19 Regulatory Liability- 217 Gross Up 14,5,326 (32,9) (8,47) (42,689) (73,6,841) (33,549,148) (244,48) 32,937 (76),654 (2,582,915) 14,198,236 Total West Texas Direct Sum Ln 2 through Ln 22 (95,517,422) (15,37) (95,622,729) WP _E-1 Page 1 of 5

73 BEGINNING BALANCE ACCUMULATED DEFERRED INCOME TAXES (1) (2) Line No Assets I (Liabilities) - Per Book Balances Descri~tion Reference at /31/217 Adjustments (3) (a) (b) (c) (d) WTX General Office {Div 1 }: Ad Valorum Taxes 131,515 MIP /VPP Accrual (376,315) 7,943 Self Insurance- Adjustment Vacation Accrual 2,44 Worker's Camp Insurance Reserve 1,331 SEBP Adjustment 373,356 FAS 16 Adjustment 6,817,149 CWIP 7,826 (7,826) RWIP (1,457) Fixed Asset Cost Adjustment (4,438,921) Depreciation Adjustment 584,952 Section 481 (a) TPR 37,87 Deferred Gas Costs (953,144) 953,144 Over Recoveries of PGA (288,748) 288,748 Customer Advances (39,732) Deferred Expense Projects (8,295) Capitalized Selling Expense UN I CAP Section 263A Costs 198, (a) UN I CAP Allowance for Doubtful Accounts (39,483) 39,483 Clearing Account- Adjustment Charitable Contribution Carryover 43,863 (43,863) Prepayments (49,624) Rate Case Accrual (773,53) 773,53 WACOG to FIFO Adjustment 38,858 Reg Asset Benefit Accrual (6,298) TX Rule 8.29 Reg Asset Deferral (51,471) Intra Period Tax Allocation (432,288) 432,288 Regulatory Liability- Atmos 19 Total WTX General Office Sum Ln 26 through Ln 54 West Texas Allocation Factor Total Allocated WTX General Office Ln 55 times Ln 56 Total West Texas Direct Ln23+Ln57 (95,34.453) 2,177,583 Assets I (Liabilities) - Adjusted Balances at /31/217 (e)= (c)+ (d) 131,515 (35,372) 2,44 1, ,356 6,817,149 (1,457) (4,438,921) 584,952 37,87 (39,732) (8,295) 198,86 (49,624) 38,858 (6,298) (51,471) (92,856,87) WP _E-1 Page 2 of 5

74 BEGINNING BALANCE ACCUMULATED DEFERRED INCOME TAXES (1) (2) Line No. Assets I (Liabilities) - Per Book Balances Description Reference at /3117 Adjustments (3) (a) (b) (c) (d) Assets I (Liabilities) - Adjusted Balances at /31/217 (e)= (c)+ (d) SSU- Customer Su~l:(2rt (Div ): MIP I VPP Accrual (531.43) 531,43 Vacation Accrual 6,868 Worker's Camp Insurance Reserve FAS 16Adjustment CWIP (468,235) 468,235 RWIP (86) Fixed Asset Cost Adjustment (23,662,64) Depreciation Adjustment 6,896,689 Clearing Account- Adjustment Charitable Contribution Carryover Prepayments (298,1) Intra Period Tax A!!ocation Total SSU Customer Support Sum Ln 62 through Ln 73 (18,56,781) 999,638 Allocation Factor 9.62% 9.62% Total Allocaled SSU Customer Support Ln 74 times Ln 75 ( ) 96,175 6,868 (86) ( ) 6,896,689 (298,1) (17.57,143) 9.62% (1,641.59) WP _E-1 Page 3 of 5

75 BEGINNING BALANCE ACCUMULATED DEFERRED INCOME TAXES (1) (2) Line No. Assets I (Liabilities) Per Book Balances Descrip!iQIJ Reference at /31/217 Adjustments (3) (a) (b) (c) (d) Assets I (Liabilities) - Adjusted Balances at /31/217 (e)= (c)+ (d) SSU- General Office (Div 2): Directors Deferred Bonus,396 MIP I VPP Accrual (1,299,225) 1,299,225 Miscellaneous Accrued Self Insurance- Adjustment 1,684,755 (1,684,755) Vacation Accrual 9,496 Worker's Camp Insurance Reserve 72,398 SEBP Adjustment 17,158,149 (17,158,149) Restricted Stock Grant Plan 865,318 (865,318) Rabbi Trust 91,834 (91,834) Restricted Stock- M!P 8,63,729 (8,63,729) Director's Stock Awards 4,34,733 Pension Expense (7,457,49) FAS 16 Adjustment 5,799,14 CWIP (55,78) 55,78 RWIP (2,47) Fixed Asset Cost Adjustment (21,446,248) Depreciation Adjustment 4,98,373 Section 481(a) Cushion Gas 343,37 (343,37) Section 481(a) Line Pack Gas 41,663 (41,663) Deferred Expense Projects Allowance for Doubtful Accounts 1 (1) Clearing Account- Adjustment (9,68) Charitable Contribution Carryover 4,737,632 (4,737,632) Prepayments (3,943,76) Stock Option Expense Federal & State Tax Interest 455,745 VA Charitable Contributions Intra Period Tax Allocation (1,737,96) Regulatory Liability- Atmos 19 FD- NOL Credit Carryforward- Non Reg (154,641,288) 154,641,288 FD- NOL Credit Carryforward - Utility 48,66,663 FD- NOL Credit Carryforward- Other 4,981,246 (4,981,246) FD- FAS 115 Adjustment (2,497,45) FD- AMT Minimum Tax Credit ST- Valuation Allow Enterprise Zone ltc (,928),928,396 9,496 72,398 4,34,733 (7,457,49) 5,799,14 (2,47) (21,446,248) 4,98,373 (9,68) (3,943,76) 455,745 (1,737,96) 48,66,663 (2,497,45) WP _E-1 Page 4 of 5

76 BEGINNING BALANCE ACCUMULATED DEFERRED INCOME TAXES (1) (2) TEST YEAR ENDING DECEMBER 31,218 Assets I (Liabilities) M Line Per Book Balances No. Description Reference at 131/217 Adjustments {3) (a) (b) (c) (d) Assets I (Liabilities} Adjusted Balances at /31/217 (e)= (c)+ (d) FD- Valuation Allow Fed Tax Enterprise Zone ltc ST- Enterprise Zone ltc FD- Treasury Lock Adjustment- Realized FD- Treasury Lock Adjustment- Unrealized FD- Federal Tax on Enterprise ltc Total SSU General Office Allocation Factor Total Allocated SSU General Office Total Allocated SSU AD IT to West Texas Grand Total West Texas AD IT Sum Ln 79 through Ln 118 Ln 119timesln Ln76+Ln1 Ln 59+ Ln 3 7 Notes: 8 1. Includes FERC Accounts 19,282 and Credit amounts are in parentheses Adjustments are for those items not included in rate base for ratemaking purposes. 25,395 (25,395) 1,841,184 (1,841 '184) 14,645,475 26,55,897 (26,55,897) (386,649) 386, ,375,175 89,236, % 7.33% 28,18,935 6,538,911 26,281,71 6,635,86 (68,752,752) 8,8,668 14,645, ,611, % 34,557,846 32,916,786 (59,94,84) WP_E-1 Page 5 of 5

77 OPERATION AND MAINTENANCE EXPENSES Line FERC Per Book No. Acct Description Amount (a) (b) (c) 1 85 Transmission - Operation Supervision and Engineering Transmission - Mains Expenses 1, Transmission - Measuring and Regulating Station Expenses 7, Transmission - Maintenance of Mains 4, Transmission -Maintenance of Compressor Station Equipment Transmission -Maintenance of M&R Station Equipment Transmission -Operation Supervision and Engineering 3,29, Distribution - Distribution Load Dispatching Distribution - Odorization Distribution - Mains and Services Expenses 5,389, Distribution - M&R Station Expenses - General 73, Distribution - M&R Station Expenses - Industrial 14, Distribution - M&R Station Expenses - City Gate 78, Distribution - Meter and House Regulator Expenses 1,466, Distribution -Customer Installations Expenses 916, Distribution - Other Expenses 29, Distribution - Rents 489, Distribution -Maintenance Supervision and Engineering 1, Distribution -Maintenance of Structures and Improvements 6, Distribution -Maintenance of Mains 17, Distribution -Maintenance of Compressor Station Equipment Distribution -Maintenance of M&R Station Equip. - General 218, Distribution- Maintenance of M&R Station Equip.- Industrial 4, Distribution -Maintenance of M&R Station Equip. - City Gate 163, Distribution -Maintenance of Services 1, Distribution - Maintenance of Meters and House Regulators 19, Distribution - Maintenance of Other Equipment 15,82 Adjustments (d) - 3, , ,513 3, ,297 69,86 48, , , ,92 77 Adjusted Amount (e)- (c)+ (d) 1,119 74,137 4, ,341, ,766, ,425 14,756 83,186 1,535, ,52 29, ,665 1,824 6,779 17,2 23,183 4, ,165 1,72 21,62 15,159 Schedule F-1 Page 1 of 2

78 OPERATION AND MAINTENANCE EXPENSES Line FERC Per Book No. Acct Description Amount (a) (b) (c) Customer Accounts -Meter Reading Expenses 1,16, Customer Accounts - Customer Records and Collection Expenses 62, Customer Accounts - Uncollectible Accounts 1,7, Customer Service- Informational & Instructional Advertising Expenses 119, Sales Expenses- Supervision 1, Sales Expenses- Demonstrating and Selling Expenses 535, A&G - Administrative and General Salaries 49, A&G - Office Supplies and Expenses 35, A&G -Administrative Expenses Transferred -Credit 24,898, A&G- Outside Services Employed 9, A&G - Property Insurance 164, A&G- Injuries and Damages 193, A&G - Employee Pensions and Benefits 2,932, A&G - Miscellaneous General Expense Total Operation and Maintenance Expenses Sum (Ln 1 through Ln 41) 45,66,859 Adjustments (d) 62,68 3,11 (52,688) 14,398 2,694 (246,56) (887) (49,755) 6,293 Adjusted Amount (e)- (c)+ (d) 1,222,781 65,177 1,647, ,41 1,54 549,688 51,973 35,348 24,652,168 9, , ,344 2,522,271 45,613,153 Schedule F-1 Page 2 of2

79 ADJUSTMENTS TO OPERATION AND MAINTENANCE EXPENSES Line FERC No. Account M ~ ~ D M 2 v ~ ~ a M u ~ ~ a a «,,, M Account Description (b) Transmission- Operation Supervision and Engineering Transmission- Mains Expenses Transmission- Measuring and Regulating Station Expenses Transmission- Maintenance of Mains Transmission -Maintenance of Compressor Station Equipment Transmission -Maintenance of M&R Station Equipment Transmission -Operation Supervision and Engineering Distribution -Distribution load Dispatching Distribution - Odorization Distribution -Mains and Services Expenses Distribution - M&R Station Expenses- General Distribution - M&R Station Expenses- Industrial Distribution - M&R Station Expenses- City Gate Distribution -Meter and House Regulator Expenses Distribution -Customer Installations Expenses Distribution -Other Expenses Distribution -Rents Distribution -Maintenance Supervision and Engineering Distribution -Maintenance of Structures and Improvements Distribution -Maintenance of Mains Distribution- Maintenance of Compressor Station Equipment Distribution- Maintenance of M&R Station Equip. -General Distribution- Maintenance of M&R Station Equip. - Industrial Distribution- Maintenance of M&R Station Equip. -City Gate Distribution -Maintenance of Services Distribution -Maintenance of Meters and House Regulators Distribution -Maintenance of Other Equipment Customer Accounts- Meter Reading Expenses Customer Accounts- Customer Records and Collection Expenses Customer Accounts- Uncollectible Accounts Customer Service -Informational & Instructional Advertising Expenses Sales Expenses- Supervision Sales Expenses- Demonstrating and Selling Expenses A&G -Administrative and General Salaries A&G- Office Supplies and Expenses A&G- Administrative Expenses Transferred- Credit A&G- Outside Services Employed A&G- Property Insurance A&G- Injuries and Damages A&G- Employee Pensions and Benefits A&G- Miscellaneous General Expense Total Adjustments to O&M Expenses Sum (ln 1 through ln 41) Adjustment Reference: Base Labor () 3, ,25 113,593 3, ,297 69,86 48, , , , ,68 3,11 14,498 2, , WP_F-2.1 Medical and Pensions and ssu Dental Retiree Medical Property Blank Employee Service-Level Miscellaneous Uncollectible Rule Blank Total Benefits (d) Benefits Insurance Sheet Expense (h) Factors (i) Adjustments Ul Expense (k) Co!!Jpliance (I) Sheet (m) Adjustments (n) 13, ,68 s WP_F-2.2,,, rn (g) (1,72) (6) (241,575) (887) s s ' 262,92 (52,688) (425) (1) (518,424) (394) (457,247) 3, , ,513 3, ,297 69,86 48, , , , , (52,688) 14,398 2,694 (246,56) (887) (49,755) (342.2nl (1.o13l. s ---s ( J~/1~"1L s (194,327) (52,688l (\1J.'ilJ. s 6,293 WP_F-2.3 WP _F-2.4 WP _F-2.5 WP _F-2.6 WP_F-2.7 WP_F-2.8 WP _F-2.9 WP _F-2.1 WP _F-2.11 Schedule F-2 Page 1 of 1

80 BASE LABOR ADJUSTMENT Line Shared Services- Shared Services - Shared Services - WTXGeneral No. Description Customer Support General Office Total West Texas Direct Office (Div. 1) Total Adjustment (a) (b) (c) (d) (e) (~ (g) Annualized December 218 Employee Salaries (1) (5) Test Year Base Labor (5) Base Labor Adjustment Total (Ln 1 - Ln 3) Allocation Factor (2) (3) Subtotal (Ln 5 x Ln 7) WTX Base Labor Allocation Factor (6) Total Allocated Base Labor Adjustment (Ln 9 x Ln 11) O&M Expense Factor (2) (3) Test Year Base Labor O&M Expense Adjustment (Ln 13 x Ln 15) Adjustment Summary: Account 922 Other O&M Accounts (4) Total (Ln 2 + Ln 21) 29,75,88 27,446,186 1,629, % 156, , % 137, , ,362 5,13,343 79,89,151 48,63,176 75,59,362 1,95,167 3,579, % 8.37% 142,91 299, ,91 299, % 81.1% 15, ,783 15,421 15,421 Notes: Annual salaries are base labor only and do not include items such as overtime and bonuses Shared SeNices based on FY1 9 factors, adjusted to the four-factor formula including Operating Income. 27 West Texas factors are based upon actual test year ratios The factors in Col (d) are a calculation derived from the totals of Customer Support and General Office and are only used in the calculation 29 of other employee-related adjustments Distribution by account is based upon per book O&M test year labor (See Page 2). 22,667,26 21,519,746 1,147,514 1.% 1,147, % 649, % 345, SSU amounts exclude cost centers which do not allocate to the West Texas Division and employee time charged below the line for rate making purposes Allocates Total West Texas Base Labor to the West Texas Genera! Office and West Texas Direct Divisions. Not applicable to Columns (b) through (d). 22,667,26 21,519,746 1,147, % 1,97, % 459, % 18, ,618 18, ,618 18, , , ,517 WP _F-2.1 Page 1 of2

81 WEST TEXAS CITIES ('WTX CITIES") RATE REVIEW MECHANISM BASE LABOR ADJUSTMENT- DISTRIBUTION OF WTX DIRECT BY FERC ACCOUNT Line FERC Per Book Ratio of Labor No. Account Account Descri~tion O&M Labor b:t: Account (a) (b) (c) (d) Transmission - Mains Expenses.% s Transmission - Measuring and Regulating Station Expenses 69, % Transmission - Maintenance of Mains 2,66.249% Transmission - Maintenance of M&R Station Equipment.% 5 87 Transmission -Operation Supervision and Engineering 937, % Distribution - Distribution Load Dispatching.% Distribution - Mains and Services Expenses 2,77, % Distribution - M&R Station Expenses -General 559, % Distribution - M&R Station Expenses - Industrial 13, % Distribution - M&R Station Expenses -City Gate 78, % Distribution- Meter and House Regulator Expenses 1,263, % 879 Distribution -Customer Installations Expenses 882, % Distribution - Other Expenses 94.19% Distribution - Maintenance of Mains.% Distribution - Maintenance of M&R Station Equip. -General 215, % Distribution - Maintenance of M&R Station Equip. - Industrial 4,7.566% Distribution - Maintenance of M&R Station Equip. -City Gate 161, 1.941% Distribution - Maintenance of Services 1, % Distribution - Maintenance of Meters and House Regulators 19,97.246% Distribution - Maintenance of Other Equipment 1,48.17% Customer Accounts- Meter Reading Expenses 1,145, % Customer Accounts- Customer Records & Collection Exp 548, % 23 9 Sales Expenses - Demonstrating and Selling Expenses 265, % A&G -Administrative and General Salaries 49, % 25 Total {Sum of Ln 1 through Ln 24) 8,299,14 1.% Base Labor Adjustment Allocated by Account (e)- (c) x (d) 3, ,25 113,593 3, ,297 69,86 48, , , , ,68 3,11 14,498 2, ,734 WP _F-2.1 Page 2 of2

82 MEDICAL AND DENTAL BENEFITS ADJUSTMENT Line No. Description Shared Services West Texas Total Adjustment (a) (b) (c) {d) 1 FY 219 Projected Expense per Employee (1) 15, Number of Employees at End of Test Period (2) 1, Sub-Total (Ln 1 x Ln 3) 15,963, Test Year Medical and Dental Cost 14,41, Medical and Dental Cost Adjustment (Ln 5- Ln 7) 1,922, Allocation Factor (3) 8.37% 13 Allocated Medical and Dental Cost Adjustment (Ln 9 x Ln 11) 16, Labor Expense Factor (3) 81.1% Test Year Medical and Dental Expense Adjustment (Ln 13 x Ln 15) 13, Adjustment Summary: 2 Account , Account Total (Ln 2 + Ln 21) 13, Notes: Costs are based on the projected Fiscal Year 219 expense per employee SSU amounts exclude cost centers which do not allocate to West Texas Division for rate making purposes Shared Services based on FY19 factors, adjusted to the four-factor formula including Operating Income. 29 West Texas factors are based upon actual test year ratios. 15, ,132,274 4,564, , % 542, % 289,68 289,68 289,68 13, ,68 419,425 WP _F-2.2 Page 1 of 1

83 PENSIONS AND RETIREE MEDICAL BENEFITS ADJUSTMENT Shared Services WTX Post- Supplemental Line Pension Employment Pension Executive No. Description Account Plan Benefit Plan Account Plan Benefit Plan (a) (b) (c) (d) (e) Post- Employment Adjustment Benefit Plan Total (D (g) Proposed Benefits Benchmark- 1 Fiscal Year 218 Willis Towers Watson Report (1) (4) 4,23,97 2,81,911 1,322, ,549 2 O&M Expense Factor (2) 81.1% 81.1% 53.24% 1.% 3 Proposed Benefits Benchmark - Expense (Ln 1 x Ln 2) 3,427,566 2,269,9 74,11 142,549 4 Allocation Factor (2) 8.37% 8.37% 95.66% 95.66% ~ ~ --- ~ ,363 93, % 495, % 473,877 1,76,756 5 Allocated Proposed Benefits Benchmark Expense (Ln 3 x Ln 4) Loo,ttt;.L 'II Jttu,uLr -- -l- --~ ot..:o,o"+t 'll 6 7 Current Benefits O&M Benchmark (5)..:oo.,,o :to - -~..-- L 1"+, 1oo - -~~ '~~ Mo,oo -- 1 'I> - 56, ,94 2,13, Test Year Adjustment (Ln 5 minus Ln 7) (76,573) (24,9) (163,3) 79,491 (158,63) (342,277) 1 11 Adjustment Summary: Account 922 (76,573) (24,9) (1,72) 13 Account 926 (163,3) 79,491 (158,63) (241,575) 14 Total (Ln + Ln 13) (76,573) _4,9} (163,3) 79,491 (158,63) (342,277) Notes: Studies not applicable to West Texas or Shared Services are omitted Shared Services' ratios in Columns (b) and (c) are based upon FY19 factors, as adjusted for the 4-Factor method including Operating Income West Texas percentages reflect FY19 allocation factors SSU amounts exclude cost centers which do not allocate to West Texas Division for rate making purposes The 216 WTX Cities RRM Settlement Agreement set the benchmark for January 1, 218- September 3, 218. The 217 WTX Cities RRM Settlement Agreement set the benchmark for October 1, 218- December 31, 218. WP_F-2.3 Page 1 of 1

84 PENSIONS AND RETIREE MEDICAL BENEFITS FOR APPROVAL Line No. Description (a) Shared Services Post- Pension Employment Pension Account Plan Benefit Plan Account Plan (b) (c) (d) WTX Post- Supplemental Employment Executive Benefit Plan Benefit Plan Total (e) <D (g) Proposed Benefits Benchmark- Fiscal Year 218 Willis Towers Watson Report Allocation Factor 4,23,97 2,81,911 1,322, % 8.37% 95.66% Proposed Benefits Benchmark Costs (Excluding Removed Cost Centers) Allocated to West Texas (Ln 1 x Ln 2) 354, ,565 1,265,145 O&M and Capita! Factor 1.% 1.% 1.% Proposed Benefits Benchmark Costs To Approve {Excluding Removed Cost Centers) (Ln 3 x Ln 4) 354, ,565 1,265,145 Summary of Expense Costs to Approve: O&M Expense Factor (WP _F-2.3, Ln 2) 81.1% 81.1% 53.24% Total Pension Account Plan 286, ,547 Total Post-Employment Benefit Plan 19,27 Total Supplemental Executive Benefit Plan Total (Sum Ln through Ln 14) 286,942 19,27 673,547 Note: 93, , % 95.66% 89,98 136,363 1.% 1.% 89,98 136,363 2,88, % 1.% 96, , ,94 136, , , ,363 1,76, West Texas is proposing that the fiscal year 218 Willis Towers Watson actuarial amounts shown on WP _F-2.3 and WP _F-2.3.1, be approved by the WTX Cities as the benchmark amounts to be used to calculate the regulatory asset or liability for future periods. The Company is requesting that the benchmark amount approved by the WTX Cities for future periods include only the expense amount. The amount attributable to capital would continue to be recorded to utility plant through the overhead process as described in the CAM. WP_F Page 1 of 1

85 PROPERTY INSURANCE ADJUSTMENT TEST YEAR ENDING DECEMBER 31,218 Line No. Descri(ltion (a) SSU -General Office (b) SSU -Customer Sugport (c) West Texas (d) Total Adjustment (e) 1 Premium Adjustment: 2 Annual Premium - Current Policy (TME March 219) (1) (2) 3 Less: Test Year Premium Amount 4 Subtotal (Ln 2 - Ln 3) 5 Allocation Factor (3) 6 Allocated Total Adjustment (Ln 4 x Ln 5) 7 O&M Expense Factor (3) 8 Total Premium Adjustment (Ln 6 x Ln 7) 9 1 Summary by Account: 11 Account 922 Account Totals (Ln 11 + Ln ) 5,479 9,83 131,38 92,816 {5,559) (2,13) 7.33% 9.62% (47) (194) 2.98% 2.98% (85) (41) (85) (41) {85) (41) 482, ,282 {3,119) 1.% {3,119) 28.44% (887) (887) (887) (6) (887) (1,13) Notes: Line 2, Annual Premium- Current Policy, does not include the insurance premium amount associated with Construction Work in Progress (CWIP) as per GUO No. 117 Final Order, Finding of Fact Nos. 192 and The premium amounts include 4.85% tax per TEX. INS. CODE (a) Shared Services Bluefiame Premiums are recorded to Cost Center 1915; however, the Customer Support Premium is allocated to West Texas based on the Customer Support factor (see Cost Center ) as adjusted for the 4-Factor method including Operating Income (see WP _F-2. 7). Both premiums are capitalized based on the Cost Center 1915 ratio. West Texas factors are based upon actual test year ratios. WP_F-2.4 Page 1 of 1

86 BLANK SHEET PAGE INTENTIONALLY LEFT BLANK WP_F-2.5 Page 1 of 1

87 EMPLOYEE EXPENSE ADJUSTMENT Line Shared Services - Shared Services - No. Description Customer Support General Office West Texas (a) (b) (c) (d) WTXGeneral Office (e) Total Adjustment (f) Twelve Months Ended December31, 218: Employee Expense Adjustment Allocation Factor (1) Allocated Employee Expense Totals (Ln 2 x Ln 3) O&M Expense Factor (1) (2) Subtotal (Ln 4 x Ln 5) Summary by Account Account922 Account 93.2 Total (Ln 9 + Ln 1 ) 13 Notes: See WP _F-2.1, Col (b) and Col (c), Ln 7 and Ln 15, as applicable, for the Shared Services factors, as adjusted West Texas costs are directly charged and not allocated % 7.33% 1.% % 73.77% 1.% % 1.% WP_F-2.6 Page 1 of 1

88 SHARED SERVICES ("SSU") SERVICE-LEVEL FACTORS ADJUSTMENT I Per Book I FY 219 Total Line SSUO&M SSU O&M Capitalization Rate Capitalization Rate No. Descrietion SSU O&M {Labor) (Non-Labor) Exeense (Labor Exe) (Non-Labor Exp) 1 1 (b) (c) (d) (b)+ (c) (e) ID I Four Factor Allocation Factor {2), {3) (g) Total (h)= (d) X (g) SSU Allocated to Capital (4) (i) (b*e*g) + (c*f"g) Expense Allocated to West Texas Gl (h)- (i) 1 11 ATM-Dai-ATM-Dallas Executive Chairman 853,269 3,175,613 4,28, % 79.2% ATM-Dai-Chief Fin Officer 468, ,81 1,2, % 79.2% ATM-Dai-ATM-Utility Operation 379, , , % 81.1% ATM-DatlasAudit 5,38,836 5,38,836.%.% ATM-Dal-Treasurer 296, ,35 58, % 56.96% ATM-Dai-Treasury 677,794 1,279,827 1,957, % 79.2% ATM-Dai-Risk Management 355, , ,25 8.% 8.% ATM-Dai-Supply Chain Management 111,1 152, , % 48.85% 9 11 ATM-Dai-Mail & Supply 17, , , % 16.6% ATM-Dai-VP & Controller 221,98 283,41 54, % 31.39% ATM-Dai-Taxation 266,89 459, , % 1.33% 1117 ATM-Dai-Accounting Svcs 225,7 295, , % 82.78% ATM-Dai-Supply Chain 424,61 31, ,556 4.% 4.% ATM-Dai-General Accounting 458, , , % 79.2% 15 1 ATM-Dai-Accounts Payable 449,8 283, , % 37.47% ATM-Dal-Piant Accounting 584,52 284, , % 9.91% ATM-Dal-Gas Accounting 289,36 39,59 679,95.%.% ATM-Dal-Financial Reporting 948,4 7,754 1,66,878.%.% ATM-Dai-Payroll 359,911 24,536 6, % 79.2% 2 18 ATM-Dai-Property & Sales Tax 1,434,973 1,68,222 2,53, % 1.18% ATM-Dal-lncomeTax 575,382 1,352,24 1,927,586 2.% 2.% ATM-Dai-Busi Planning & Analysis 816, ,586 1,337, % 59.61% ATM-Daltas Media Relations 19,7 19,7.%.% ATM-Dai-Jnvestor Relations (5) 445, ,893 1,25,48.%.% ATM-Dai-Corporate Communications 715,645 1,178,6 1,893,771.%.% ATM-Dai-IT 1,43,27 1,568,898 2,999, % 38.57% ATM-Dai-IT E&O Corporate Systems 1,963,227 9,154,267 11,117, % 31.% ATM-Dai-IT Engineering & Operations 3,765,789 14,761,668 18,527, % 34.63% ATM-Dai-Gas Purchase Acctg 522, ,6 76,861.%.% ATM-Dai-Rate Administration 637, ,762 89,73.%.% ATM-Dai-Revenue Accounting 277, , ,965.%.% ATM-Dai-Strategic Planning 428, ,564 1,6, % 72.58% ATM-Dai-Distribution Acctg 613, , ,638.%.% ATM-Dai-Rates & Regulatol)' 1,553,17 1,181,88 2,734, % 79.2% ATM-Dai-Gas Pipeline Accounting 13,334 51, ,16.%.% ATM-Dai-IT Customer Services Systems 2,396,372 5,59,242 7,455, % 27.54% ATM-CCC IT Support 2,377,711 2,377,711.%.% ATM-Dal-Technical Training 288, ,82 1,152,56.%.% ATM-Dal-Benefits & Payroll Accounting 388, , , % 79.2% ATM-Dai-IT Security 994,14 2,438,786 3,432, % 17.% ATM-Dai-IT Enterprise Architecture 595,88 266, ,45 2.% 6.% ATM-Dai-RegulatoiY Accounting 193,23 86,81 28, % 79.2% 43 1 ATM-Dai-ATM-Dallas President & CEO 946,39 2,67,621 3,616, % 79.2% 44 5 ATM-Dai-ATM-Dallas Executive Vice President 298, ,153 1,19,91.62% 13.9% 45 9 ATM-Dai-Security & Compliance 66, ,28 1,626, % 2.14% 46 ATM-CSO-Customer Contact Center 14,334,17 7,738,432 22,72, % 19.46% ATM-Dai-Dispatch Operations 4,795,21 1,899,829 6,695,39.%.% 7.33% 295, % 88, % 86, % 394, % 42, % 143, % 53, % 19, % 35, % 36, % 53, % 38, % 54, % 5,8 7.33% 53, % 63, % 5, % 1, % 43, % 183, % 141, % 98, % 1, % 88, % 138, % 219, % 814, % 1,357, % 66, % 83, % 39, % 77, % 78, % 22,75.% 9.62% 717, % 228, % 84, % 39, % 251, % 63, % 2, % 265, % 81, %, % 2,3, % 644,6 233,293 7,216 7,476 24, ,357 42,688 9,56 5,714 11, ,638 21,88 39, ,877 34,769 2,158 2,825 58,432 84, ,36 439,279 56,387 16, ,611 3,986 42,763 2,693 16,46 29,439 1,544 2, ,2 61,927 18,639 16, ,286 18,311 3,9 1,672 1, ,366 52,57 6,582 32,652 1,55 33,573 5,784 5,84 1,73 9, , ,421 39,595 1,414 88, , , , ,34 66,266 83,51 39,746 21,298 78,433 42,52 557,69 228,758 84,455 8,225 28,785 43,243 4,355 55,595 7, ,992 1,71, ,6 WP _F-2.7 Page1of3

89 SHARED SERVICES ("SSU") SERVICE-LEVEL FACTORS ADJUSTMENT Per Book FY 219 Total Line SSU O&M SSU O&M Capitalization Rate Capitalization Rate No. Descrietion SSU O&M (Labor) (Non-Labor) Expense (Labor Exp) (Non-Labor Exel (o) (b) (o) (d)- (b)+ (c) (e) (~ Four Factor Allocation Factor {2), (3) (g) Total (h)= (d) X (g) SSU Allocated to Capital (4) (i) (b*e*g) + (c"f"g) Expense Allocated to West Texas G)- (h)- (i) ATM-ATM-Dallas Training & Knowledge Mgmt 3,556 15,543 46,99.%.% ATM-Dai-ATM-Pipeline Admin 96,911 96,911.%.% 5 24 ATM-Dai-CSO Human Resources 461,55 239,341 7,395.%.% ATM-Dai-Customer Service 1,327,94 654,331 1,981,425.94% 9.46% ATM-Dai-Customer Program Mgmt 1,723,451 1,354,643 3,78, % 17.3% ATM-Dai-Customer Revenue Management 3,285,916 2,299,344 5,585,26.%.% ATM-Dai-ATM-Dallas Pipeline Safety 665, ,56 1,414, % 41.9% ATM-Dai-Employment & Emp Rei 521, ,23 1,117,997.%.% ATM-Dallas Executive Compensation 384,74 384,74.%.% ATM-Dai-ATM-Dallas SVP Human Resources 751,26 833,19 1,584,45.%.% ATM-Dai-Benefils 663, ,275 1,292,533.%.% ATM-Dai-Facilities 54, ,72 699, % 33.% ATM-Dai-Employee Oev 459,89 1,195,762 1,655,652.%.% ATM-Dai-Tech Training Delivery 1,181,68 1,624,253 2,85,933.%.% ATM-Dai-Tech Trng Prog & Curriculum 73, ,552 1,47,911.%.% ATM-Dai-Compensation & HRMS 873, ,86 1,361,897.%.% ATM-Dai-ATM-Corporate Programs 331, , ,.%.% ATM-Dallas EAPC 55,935 55,935.%.% ATM-HR Benefit Variance (1,272,84) (1,272,84) 15.5% 16.6% ATM-Dal-legal 3,25,44 3,43,611 6,428, % 35.89% ATM-Corporate Secretary 1,452,626 1,452,628.%.% eg 153 ATM-Dai-Governmental Affairs 328, ,64 655,923.%.% ATM-Dai-Central Records 249, ,51 778, % 79.2% ATM-Corporate Gas Contract Administration 22,81 3,586 53,388.%.% ATM-Dai-Energy Assistance 425,15 387, 8,28.%.% ATM-Dai-Gas Supply Executive 459,748 1,27,641 1,487,388.%.% ATM-Dai-Regionat Gas Supply 29,53 171,95 462,3.%.% ATM-Dai-Gas Contract Admin 358,21 169, ,859.%.% ATM-Franklin-Gas Control & Storage 411, ,6 653,95.%.% ATM-New Orleans-Gas Supply & Services 172,1 367, ,835.%.% ATM-Regional Supply Planning 429, ,97 675,897.%.% yg 1828 ATM-Jackson-West Region Gas Supply & Services 15,796 67,53 173,326.%.% ATM-Franklin-East Region Gas Supply & Services 45,92 45,92.%.% ATM-Dal-Gas Supply 617, , ,711.%.% ATM-Corporate Gas Supply Risk Mgmt 113,785 93,496 27,28.%.% ATM-Franklin-Gas Control 887, ,11 1,431,549.%.% ATM-Dal-TBS System Support 25,34 168, ,915.%.% ATM-DaJ-TBS Application Support 76,45 3,482 1,6,886.%.% ATM-Dal-TBS Technical Support 666,23 42,1 1,68,24.%.% ATM-Dal-TBS Transportation & Scheduling 232,6 81, ,587.%.% ATM-Dallas Employee Relocation Exp (Div 2) (6) 158,262 21, ,7.%.% ATM-Dallas Employee Relocation Exp (Div ) (6) 67,592 22,921 9,513.%.% go 193 ATM-Dai-Controller Mise (1).%.% ATM-Dallas Performance Plan (5) 15,616,82 15,616, % 31.1% ATM-Outside Director Retirement Cost 3,614,134 3,614,134.%.% ATM-Daltas SEBP (5) 6,496,929 6,496,929.% 79.2% 7.33% 3,378.% 9.62% 67, % 19, % 228, % 537, % 14, % 81, % 28, % 116, % 94,7 7.33% 51, % 1, % 28, % 77, % 99, % 64, % 4, % (93,266) 7.33% 471, % 16, % 48, % 57, % 3, % 76,5 7.37% 19, % 74, % 49, % 117, % 5, % 63,364.%.%.% 9.37% 19, % 257, % 3, % 78, % 78, % 23, % 26, % 8,78.% 7.33% 1,144, % 264, % 476,69 7,159 21,326 43,936 16,925 (15,483) 169,87 45, , ,26 3,378 67, ,473 26, ,355 6,917 81,922 28, ,73 94,7 34,364 1,32 28,23 77,689 99,794 64,777 4,99 (77,783) 31,98 16,443 48,628,11 3,958 76,5 19,559 74,62 49, ,662 5,68 63,364 19, ,59 3,857 78,143 78,669 23,98 26,357 8,78 788,4 264,829 99,863 WP_F-2.7 Page 2 of3

90 SHARED SERVICES ("SSU") SERVICE-LEVEL FACTORS ADJUSTMENT Line No. Description (o) l per Book FY 2o19 SSU O&M (Labor) (b) SSU O&M (Non-Labor) (o) Total Four Factor SSUO&M Capitalization Rate Capitalization Rate Allocation SSU Allocated to Expense (Labor Exp) (t'_j_on-labor Ex"Q)_ Factor (2), (3) Total Capital (4) (d)= (b)+ (c) (e) (f) (g) (h)= (d) x (g) (1)"' (b*e*g) + (c*f"g) Expense Allocated to West Texas (j)"' (h)- (i) ATM-Corporate Overhead Capitalized (4) (63,713,58) ATM-Dai-Fieet Management 67, , ATM-Dallas Insurance 18,874, ATM-Dallas Enterprise Team Meeting 12, ATM-Dallas Culture Council 3, TOTAL (Sum of Ln 1 through Ln 98) 72,829,66 76,989, Allocated Shared Services O&M to West Texas Direct Total Adjustment to Account 922 (Ln 99- Ln 11) Notes: The amount in Cost Center 193 of 28,338,821 was not allocated during the test period Factors are displayed only if applicable to West Texas Based on Fiscal Year 219 factors, adjusted to the four-factor formula including Operating Income The Total represents the amount that would be credited from Cost Center 191. (63,713,58) 883,382 18,874,41 12, 3, ,819, Allocation percentages have been set to zero to align with GUO No. 117 for Cost Centers 1132, 194 and Cost Center 191 expenses have been divided between General Office (Div 2) and Customer Support (Div ) and separately allocated..%.%.% 57.77% 57.77% 7.41% 65,491 37,837.% 79.2% 7.33% 1,383,42 1,92,928.%.% 7.33% 7,474.%.% 7.33% ,37,654 4,887,75-27,655 29,114 7, ,149,94,668,328 ( ) WP_F-2.7 Page 3 of3

91 SHARED SERVICES ("SSU") COST CENTER FUNCTIONS Line No. Division (1) (a) Cost Center/Description (b) Cost Center Function (c) ATM-Dai-ATM-Dallas Executive Chairman 111 ATM-Dai-Chief Fin Officer 112 ATM-Dai-ATM-Utility Operation 115 ATM-Dallas Audit 116 ATM-Dai-Treasurer 117 ATM-Dai-Treasury 118 ATM-Dai-Risk ManaQement 111 ATM-Dai-Supplv Chain Manaoement 11 ATM-Dai-Mail & Supply 1114 ATM-Dai-VP & Controller 1116 ATM-Dai-Taxation 1117 ATM-Dai-Accounting Svcs 1118 ATM-Dai-Supplv Chain 1119 ATM-Dai-General Accountino 1 ATM-Dai-Accounts Payable 11 ATM-Dai-Piant AccountinQ 13 ATM-Dai-Gas Accounting 15 ATM-Dai-Financial Reporting 16 ATM-Dai-Pavroll 18 ATM-Dai-Property & Sales Tax 19 ATM-Dal-lncome Tax 113 ATM-Dai-Busi PlanninQ & Analysis 1131 ATM-Dallas Media Relations Costs associated with the Executive Chairman Costs associated with the CFO Costs associated with the Senior VP Utility Operations Costs associated with internal and external audit services. Costs associated with the VP, Treasurer who manages Treasury, Procurement and Risk Management. The Treasurer supports the overall financing needs of the Company for both O&M and capital projects. Costs associated with treasury operations Costs assoclated with insurance and risk manaqement Costs associated with ourchasina and mail room activities Costs associated with mail services at the Dallas corporate office Costs associated with the VP, Controller Costs associated with the VP, Tax Costs associated with management of General Accounting, Accounts Payable, Plant Accounting and Payroll departments Costs associated with manaqement of products and services for Operations. Costs associated with maintainina the aeneral books and records of the Company Costs associated with the processing and payment of the Company's bills Costs associated with the recordkeepinq for the Company's fixed assets Costs associated with the management of utility margin accounting, utility rate administration, and Texas and Louisiana pipeline accounting. Costs associated with the preparation and distribution of both internal and external reportinq Costs associated with payinq the Company's emplovees Costs associated with the management and handling of the Company's property and sales tax aciivities Costs associated with the processing of the Company's income taxes Costs associated with the plannino and budqetinq activities of the Company Costs associated with communicating customer service and safety messages to the media, business and industry leaders. Costs associated with crisis communications functions including training staff on media relations, interviews, press conferences, and press queries to better inform the public and our customers in a crisis. Costs associated with video creation and dissemination to the public to educate customers and stakeholders on the environmental and safe and reliable benefits of natural gas. WP _F Page 1 of 9

92 SHARED SERVICES ("SSU") COST CENTER FUNCTIONS Une No. Division (1) Cost Center/Description Cost Center Function (a) (b) (c) ATM-Dal-lnvestor Relations Performs a number of significant activities directly related to attracting capital investment and maintaining important relationships with the investing community. Such activities include, but are not limited to: 1.) Accompanying executive management at all discussions with the investing public and financial press to maintain compliance with SEC Regulation FD, applicable to all publicly trade companies. 2.) Initiating, building and maintaining relationships with the financial analyst community and individual investors, as wei! as serving as the first point of contact between the Company and institutional and individual investors. 3.) Preparing and presenting financial presentations throughout the year as needed and overseeing the issuance of financial press releases at least four times per year to report and explain the financial performance of the Company. 4.) Keeping executive management apprised of investor opinions and concerns. 5.) Reviewing research reports submitted by analysts and providing accurate feedback to foster reporting accuracy ATM-Dai-Corporate Communications 6.) Maintaining knowledge of other companies that are considered to be Atmos Energy's peers. 7.) Providing management and the Company's Board of Directors with information regarding developments in the financial markets and perceptions of investors that may have use in formulating the Company's long and short-term practices and policies. 8.) Serving on the Company's 7-member Financial Information Committee to review all SEC filings to ensure appropriate and accurate disclosures are made. 9.) Prepare and provide al! operating divisions, treasurer, risk management, and all SSU departments with a comprehensive presentation explaining the strategy, financial performance, rate and regulatory strategy, etc. to use as a communication tool for all stakeholders. 1.) Overseeing the Stock Transfer Agent's administration of the Company's Direct Stock Purchase Plan and Dividend Reinvestment Plan, as wei! as ongoing plan redesign to ensure best practices. Providing investors with reliable, comprehensive information about the Company is a critical step in attracting equity investment capital. This information may be especially important in attracting non-institutional equity investors who do not have access to the range of analysts' reports, and attracting such investment has both near-term and longer-term direct benefits to the Company. The near-term benefits result from rising equity prices, which immediately translate to lower cost common equity, and ultimately ratemaking benefits through lower rates. For example, increased investment and higher equity prices lowers the yield calculation, as shown in the common Discounted Cash Flow formulation of the cost of capital. In a similar vein, the longer-term benefits derive from providing lower cost equity to maintain and expand the utility system. Costs associated with internal and external corporate communications including the annual report to shareholders ATM-Dai-IT 1135 ATM-Dai-IT E&O Corporate Systems Costs associated with the VP, CIO who manaoes all IT functions, and the direct reoorts to the CIO. Costs associated with the maintenance and support of the Company's information systems (software) WP_F Page 2 of9

93 SHARED SERVICES ("SSU") COST CENTER FUNCTIONS Line No. Division (1) (a) Cost Center/Description (b) Cost Center Function (c) ATM-Dai-IT Engineering & Operations Costs associated with the maintenance and support of the Company's data center. Operational services include - IT Systems and network engineering Service desk Desktop support Hardware and software maintenance for infrastructure items Support and administration of our database and SAP Basis environments The IT Quality Assurance (testing) processes ATM-Dai-Gas Purchase Acctg 1144 ATM-Dai-Rate Administration 1145 ATM-Dai-Revenue Accountino 115 ATM-Dai-Strategic Planning 1153 ATM-Dai-Distribution Acctq 1154ATM-Dai-Rates & Regulatory 1155 ATM-Dai-Gas Pipeline Accountino 1156 ATM-Dai-IT Customer Services Systems Costs associated with the accounting for the utllity's distribution gas purchases. Costs associated with filinq PGA, tariffs and recovering qas costs Costs associated with the accounting for the utility's distribution oross marain. Costs associated with the VP, Strategic Planning who manages Business Planning & Analysis and Rates & Regulatory Affairs. Costs associated with the accountinq for the utility's distribution revenues. Costs associated with rate case and regulatory work. Purpose is to manage the Company's rate strategy for regulated rates as wei! as the rate and regulatory activity for Atmos' eight state operating area. The primary activity is the establishment of base rates through rate cases or formula ratemaking mechanisms. The department currently has approximately twenty base rate case filings or formula mechanisms to manage in order to effect rate changes in its various jurisdictions as wei! as monthly, quarterly and annual reports to meet reporting requirements. Costs associated with accountinq for the Texas and Louisiana qas pipeline systems. Costs associated with developing and supporting Customer Service technologies. Also includes development and support of the interfaces between our internal systems and external vendors; and support and administration of our business intelligence I reporting environment. Costs include labor, software maintenance, and related expenses ATM-CCC IT Support 1159 ATM-Dal-Technical Training 1161 ATM-Dai-Benefits & Payroll Accountina 1164 ATM-Dai-IT Security Costs associated with supporting the IT activities in the Customer Contact Centers. Supports both the Amarillo and Waco customer contact centers, providing telephone and IT support for our contact centers. Costs in this center include hardware maintenance and software maintenance for call center equipment and software, and telephone access charoes (not lana distance). Costs associated with the VP Workforce Development who oversees technical training and employee development activities across the enterprise. Costs associated with management of payroll and benefits departments Costs associated with providing the strategic direction for Cyber Security in the organization. Also includes the costs related to providing telecommunications to the corporate office (lines, equipment, etc.), network operations center and security administration. WP _F Page 3 of 9

94 SHARED SERVICES ("SSU") COST CENTER FUNCTIONS Line No. Division (1) (a) Cost Center/Description (b) Cost Center Function (c) ATM-Dai-IT Enterprise Architecture 1171 ATM-Dai-Regulatory Accounting Costs associated with setting the strategic architecture for our information systems and infrastructure. Also includes the Project Manaqement function. Costs associated with regulatory accounting work on rate cases, special projects and other Commission requests as well as regulatory reporting to utility commissions, government and industry groups. This cost center was created to clearly identify personnel who devote their time to working on the regulatory accounting and reporting side of the business on rate cases, special projects, commission annual reports and other commission requests such as documenting the Company's cost allocation methodologies and capitalized overhead study ATM-Dai-ATM-Dallas President & CEO 5 ATM-Dai-ATM-Dallas Executive Vice President 9 ATM-Dai-Security & Compliance ATM-CSO-Customer Contact Center 15 ATM-Dai-Dispatch Operations 16 ATM-ATM-Dallas Training & KnowledQe MQmt 21 ATM-Dai-ATM-Pipeline Admin 24ATM-Dai-CSO Human Resources 26 ATM-Dai-Customer Service 27 ATM-Dai-Customer Program Mgmt 28 ATM-Dai-Customer Revenue Management 29 ATM-Dai-ATM-Dallas Pipeline Safety Costs associated with the CEO Costs associated with the Executive Vice President. Costs associated with safety compliance and security Costs associated with both the Waco and Amarillo Customer Support Centers. Service Orders to Service techs for emergency calls and same day service. To alert first responders of emergency situations and to communicate service order information to the approximately 75 service technicians throughout the regulated divisions. Costs in this center include the labor and related expenses to staff the dispatch function twenty-four hours a dav as wei! as bui!dina maintenance and telecom costs. Cost associated with the training of employees. This cost center includes employees who work on the pipeline administration function who primarily serve our Louisiana industrial gas customers. These costs are primarily directly charged to TLGP (Trans Louisiana Gas Pipeline) and AELIG (Atmos Energy Louisiana Industrial Gas). The costs in this cost center do not get allocated to the utility companies or APT. Costs associated with Human Resources in the Customer Service Oraanization. Costs of management and administration of customer service organization (revenue management, customer contact and program development). Includes overall CSO management and administration (excluding Human Resources which is included in CC24) and Regulated Operations initiatives. CSO management provides support to the contact centers as well as other CSO departments. Define and implement business solutions and help employees understand, prepare for, and act on changes necessary to operate our business exceptionally well. Costs associated with managing customer revenue functions of billing, payment applications and collections. This center provides day-to-day support and transaction processing for customers in all states served by Atmos. Also includes the outside vendor costs of bill printing, accepting payments and collection agency fees. Costs associated with the oversight of pipe replacement activities, pipeline safety, employee safety and technical traininq activities.! WP_F Page 4 of9

95 SHARED SERVICES ("SSU") COST CENTER FUNCTIONS Line No. Division (1) (a) Cost Center/Description (b) Cost Center Function (c) ATM-Dai-Employment & Emp Rei 142 ATM-Dallas Executive Compensation 143 ATM-Dai-ATM-Dallas SVP Human Resources 145 ATM-Dai-Benefits Costs associated with recruiting, staffing and onboarding, as wei! as HR compliance processes, operations, audits, investigations and risk management. Purpose is to develop, implement and administer employment related activities including: employee relations, corporate compliance, AA/EEO plans and reporting, responses to regulatory and legal inquiries (EEOC, OFCCP, Drug and Alcohol, MVR's, Vets 1, etc.) selection, hiring and onboarding. Costs charged to this cost center include labor and related expenses, professional association dues, contract labor, legal fees and professional reference books. These costs are a necessary component in providing human resource services to our emolovees. Costs associated with the compensation committee of the Board of Directors. Costs incurred for executive compensation work for the Human Resources Committee of the Atmos Energy Board of Directors. Also included are costs related to corporate officer annual physical exams paid by the Company. These costs are a necessary component of providing human resource services to the corporate officers that are necessary for the provision of safe and reliable service. Costs associated with the VP Human Resources. Costs associated with the management of the Company's benefit plans. The purpose is to ensure Atmos provides its employees the most cost effective benefit plans that are 1) competitive within the utility sector and general industry overall, and 2) consistently applied to all employees. Specifically, this cost center is accountable for: Group Medical Plan and Retiree Medical Plan; Group Dental Plan; Group Vision Plan; Wellness Plans (Compass, Advance Medical and Naturally Slim); Employee Assistance Plan; Group Life Insurance Plan; Optional Life Insurance Coverage (Group Variable Universal Life and Supplemental Term life for employee, dependent spouse and child(ren)); Flexible Benefits Plan; Health Savings Account; Business Travel & Accident Insurance; Service Awards Program; Defined Contribution Plan; Defined Benefit Plan; The Master Trust (holds assets of the defined benefit plan); Taxable and Tax Exempt VEBA Trusts; Pension Payments to 1,5 retirees; Collection of Retiree Medical Contributions; Workers' Compensation; Neuromuscular Corporate Solutions; Group Long-Term Disability Plan; Short-Term Disability; Family Medical Leave; and Supplemental Benefits Plan (executive) ATM-Dai-Facilities 148 ATM-Dai-Employee Dev 1414 ATM-Dai-Tech Trainino Delivery 1415 ATM-Dai-Tech Trng Prog Curriculum Costs associated with the man aement of the Colllfl_a11)1's facilities (office.)_ Costs associated with designing, developing and implementing training and development opportunities for all employees in areas of customer service, leadership, culture shaping and communication. All training and development costs including those that go into the development and delivery of training programs or participant manuals go into this cost center. This cost center also provides training and development support to both customer support centers and all divisions. Costs associated with technical trainino delivery & Costs associated with the technical training curriculum and program development I WP _F Page 5 of9

96 SHARED SERVICES ("SSU") COST CENTER FUNCTIONS Line No. Division (1) (a) Cost Center/Description (b) Cost Center Function (c) ATM-Dai-Compensation & HRMS Costs associated with the management of the Company's compensation plans and maintenance of HR employee database. The purpose is to ensure Atmos provides its employees the most cost effective pay plans that are competitive within the utility and pipeline sector and general industry overall. Costs charged to this cost center include labor and related expenses, software maintenance, salary surveys, professional association dues and contract labor. These costs are a necessary component in providing human resources services to our employees ATM-Dai-ATM-Coroorate Proqrams 142 ATM-Dallas EAPC 1463 ATM-HR Benefit Variance 151 ATM-Dai-Legal 152 ATM-Corporate Secretary 153 ATM-Dai-Governmental Affairs 154 ATM-Dai-Central Records 155 ATM-Corporate Gas Contract Administration 158 ATM-Dai-Energy Assistance 1821 ATM-Dai-Gas Supply Executive 1822 ATM-Dai-Regional Gas Supply 1823 ATM-Dai-Gas Contract Admin Event and trainino materials inc!udinq printinq, supplies and other associated trainiq.q_ costs. Costs associated with the Shared Services Employee Activities Planning Committee (EAPC). This committee organizes various Dallas employee-related team building activities throughout the year, including the Company's Lincoln Center United Way campaign. This includes meals incurred by the EAPC as well as office supplies and materials. This does not include employee compensation for their work on the EAPC. These costs are a necessary component to providing human resource services to our employees and as such are reasonable and necessary to the provision of safe and reliable service. Used to accumulate the differences between the actual cost of employee benefits and the bu.9.9_eted benefits rate Costs associated with the Corporate Legal department, which includes the SVP, General Counsel & Corporate Secretary Costs associated with the Board of Directors and shareholders. Costs such as Director's fees, board meeting expenses. proxv solicitation expenses and NYSE fees are recorded in this cost center. Costs associated witl}_g_overnmental relations Costs associated with the storage and maintenance of Company records Costs associated with maintaining and administrating the Company's gas contracts Costs associated with planning, organizing, developing, monitoring and overseeing all aspects of the Company's EnerQy Assistance and Customer Advocacy Program. Costs associated with the VP, Gas Supply & Services Costs associated with the man<eaement of the R"[ional S~pply department for West Texas and Mid-Tex. Costs associated with maintaining and administrating the Company's gas contracts for the entire utility operations ATM-Franklin-Gas Control & Storage 1826 ATM-New Orleans-Gas Supply & Services 1827 ATM-Reoional Supply Planninq 1828 ATM-Jackson-West Region Gas Supply & Services 1829 ATM-Franklin-East Region Gas Supply & Services 1831 ATM-Dai-Gas Supply Costs associated with supporting Franklin Gas Control and Atmos Energy Storage Operations for all utility areas excluding Mid-Tex. Costs associated with the Director of all the Gas Supply, Planning & Hedging departments. Costs associated with the manaqement of the Gas Supply Plannil1f!_ d~artment for all utili!)!_ divisions. Costs associated with the management of the Jackson Gas Supply and Services department which includes the regions of Mississippi, Louisiana, Colorado and Kansas. Costs associated with the management of the Franklin Gas Supply and Services department which includes the regions of Kentucky, Tennessee and Virginia. Costs associated with the management of the Gas Supply department related to the Mid-Tex Division. WP_F Page 6 of9

97 SHARED SERVICES ("SSU") COST CENTER FUNCTIONS Line No. Division (1) Cost Center/Description (b) (a) Cost Center Function (c) The ATM-Dai-TBS Application Billing System 86 applications and related processes. The TBS Suite enables divisions to perform gas scheduling and complex billing I functions for transportation and industrial sales customers, and provides support for those systems. Cost Center 1838 the Technical Support group which is responsible for polling all of the electronic meters as well as providing loroaramming support to the TBS application. Costs in these centers include Company labor and related expenses as as software maintenance fees, contract labor and tools to support the TBS system application. 87 & To provide support for ATM-Dallas Employee Relocation Exp 89 9 WP_F Page 7 of9