20230130Comments_1.pdf

From:PUCWeb Notification
To:Jan Noriyuki
Subject:Notice: A comment was submitted to PUCWeb
Date:Monday, January 30, 2023 9:00:09 AM
The following comment was submitted via PUCWeb:
Name: R k Rannow
Submission Time: Jan 30 2023 8:25AMEmail: [e-mail]
Telephone: [phone]Address: S Caddis Pl
Boise, ID 83716
Name of Utility Company: IGC
Case ID: INT-G-22-07
Comment: "I am opposed to IGC rate increase request as gas and energy profits are at a recordlevel. In fact, third quarter (22Q3) profits for oil and gas companies are stunning. In Q2, BP
made $8.45B, slightly less in 22Q3 ($8.2B). Extrapolated to an annual basis the number wouldbe $33.4B annually. The five super-majors (Exxon Mobil, Shell, Chevron, Total Energies, and
BP) annualized profits (based on Q2 and Q3 numbers extrapolated) average $45.2B per year;35% higher than BP. How do these profits compare with recent history? Between Q2 in 2003
and Q1 in 2015, the five super-majors averaged a profit of $25B per quarter or $100Bannually; $20B/year for each company (on average). These are hefty profits and remarkable
because they were fairly consistent over the past 12 years. In terms of natural gas commoditypricing, like nearly everything, the pandemic drove up prices due to labor and execution
efficiencies, a direct result of the pandemic. Now that we have moved to an endemic situation,commodity pricing has returned to 2018 prices (Natural gas (USD/MMBtu) 2.7107). The
inflation spike of 2021 and 2022 presented real policy challenges for local, regional, andnational public leaders. In order to better understand this policy debate, it is imperative to look
at prices and how they are being affected. The price of just about everything in the USeconomy can be broken down into the three main components of cost. These include labor
costs, nonlabor inputs, and the “mark-up” of profits over the first two components. Meaningfuldata on these separate cost components exist for the nonfinancial corporate or NFC sector, and
NFC makes up roughly 75% of the entire private sector. Since the COVID-19 recession in thesecond quarter of 2020, overall prices in the NFC sector rose at an annualized rate of 6.1% (a
pronounced acceleration over the 1.8% price growth that characterized the pre-pandemicbusiness cycle of 2007–2019). Furthermore, more than 50% of this increase (53.9%) can be
attributed to fatter profit margins, with labor costs contributing less than 8% of this increase.This is not normal. Again, THAT IS NOT NORMAL. Based on facts and evidence, from 1979
to 2019, profits only contributed about 11% to price growth and labor costs over 60%.Nonlabor inputs (an indicator for supply-chain issues) drove-up prices more than usual in the
current economic recovery. Based on facts and evidence, the rise in inflation has not beendriven by anything that looks like an overheating labor market. Rather, inflation was primarily
driven by higher corporate profit margins and supply-chain bottlenecks. It appears poorplanning and execution, as well as corporate greed by IGC, resulted in unusually high costs,
costs that IGC uses to decrease its tax burden. IGC poor planning and execution costs cannotbe pushed onto the consumer, who are already hurting from corporate greed and the now-
easing supply chain. Approving IGC price increase is short-sighted and will have negative consequences for more than 98% of Idahoans, as well as businesses. "
------