Wikipedia says IGH is about 2% less efficient than derailleur gearing. What does that really mean to your riding experience and speed? I guess that for the same effort, you transfer 2% less force to the wheels. But since effort has a nonlinear relationship to speed, as your effort increases from low to medium to high, the actual reduction in speed relative to derailleur gearing is progressively less.

So the actual reduction in speed is less and less as effort increases. Is my thinking correct about this?

https://en.m.wikipedia.org/wiki/Hub_gear

Yes, IGH is also heavier. On a typical commute bike this would seem to have even less influence on speed.