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>2. The city has lost R1.6b ($130m) in water fees due to reduced usage, so now we're facing a "drought tax". To me this is bullshit but thats a whole other post.

Why?

In already deployed networks, decreased usage means the cost per client, or the cost per unit used will go up.

This is a problem with any network that charges for delivery based on usage and cannot easily cut off unused parts of the network.

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It's also a problem with networks that bill by usage but spread both fixed and usage-variable costs across the expected usage, even if they don't have issues cutting off unused parts of the network; a sharp drop in usage underfunds the costs that aren't variable.

Because that shouldn't be charged after the fact, ideally it should be priced into the water prices as consumers purchase it.

That's assuming pricing scales linearly.

More likely, it takes a flat-ish $x to maintain the infrastructure, and the reduced usage means they can't reach that minimum $x threshold.

To not charge it after the fact, you’d have to recoup costs much faster in the earlier years of the system existence, causing crushing water bills to exist.

It’s not a policy issue, it’s an education issue.

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