The second question is whether or not the incentives are politically acceptable. They need to be sure that the incentive system does not anger people so that some form of political opposition rises. If that happens, it could lead to the incentive being repealed. Third, it is important to design a system that is not easily evaded. Some people, believe it or not, have found ways to tamper with their water meter so it appears that less water has been used.
Education is a crucial part of incentives.
It is very hard for people to do anything in life without a reason, and even harder for people to change their behaviors without a reason. Conservation behaviors are a less visible part of everyday life. Education can help to provide motivation during the times with little sense of accomplishment. There has been quite a bit of research done on educating people about conservation . Education can take many forms.