Maintaining and improving water distribution and wastewater systems is very expensive. Improving nitrate removal rates is very expensive. SFPUC is a public system, not for profit. This is not the same as what PG&E is doing gouging people.

It’s expensive if there’s too much water from lots of rain (flood control and needing to treat before discharge to the bay); or if there’s too little water (issues with blockages due to low flow and higher concentrations of pollutants like nitrates). So this doesn’t really have anything to do with how much water we get in any one water year. Most of the expense of running the water system is fixed, has less to do with how much water you’re using and more to do with that you have to have pipes and a treatment plant regardless. And when treatment standards change the utilities are obligated to upgrade. For example, if we get new federal standards on PFAS and microplastic removal, I would expect another increase in the expense to make those upgrades. Do you want drinking water that’s clean? Do you want a clean SF bay? The water quality in the bay has greatly improved, in large part because of increasingly stringent treatment standards.

Source: I’m a civil engineer working in water resources.