I can't see any situation where true unlimited usage for a flat rate, even a wildly expensive and uneconomical one, would make any sense because as often happens you'd basically be incentivizing people to waste as much gas, electricity and water as they possibly can to "get their money's worth" or whatever, and we should be encouraging the exact opposite for those 3 things.
Although here, if people get into debt they can be forced onto pre-payment meters where that's not an option, and the unit price is also higher. There's a lot of controversy about this.
Power in Greece works the same way, except you (are supposed to) get the guess one month and the count the next (and pay the difference). In practice, they count less often than that.
That's not the motive where I live. There's basically 2 reasons: (1) customers (esp. those, often less well off, that resort to “money earned, money spent”) like the predictability of it; and (2) depending on the season spending changes significantly (heating, cooling), whereas salaries don't.
Usually the corrective amount is also paid out over a period of months if it exceeds X% of one month's spend.
We own an old 170 sq.m. semi-detached house, and the electricity bill for June was 20 euros. That's with all heating & hot water coming from electricity (heat pumps) and owning an EV that we charge at home.