I don't understand this argument. Neither 1 day nor 10,000 days in jail repays damages to the utility; meanwhile, neither 1% nor 100% of damages serves society's goal of deterring crime. What is the point you are trying to make? That people should either be punished for crimes, or required to repay damages?
From what I can tell, virtually every crime against property has a process for settling damages irrespective of the amount of time served in prison. "10-15 months in jail AND a fine not to exceed $50,000", and so on.
The amount calculated as damages affects the kind of crime that it's categorized as though, which is why it's relevant. In the U.S. at least, if you cause $50 of damage, that's a different crime than if you cause $50,000 of damage, with different sentence ranges (same with theft, which has various categories based on dollar thresholds, and can actually switch it between a misdemeanor and felony).
That might not be the right way to do it, but it's the way it's currently done, anyway, which means that courts have to inquire into the "true" damages sustained in order to determine what crime the person should be charged with.
A solution could be not to take damages into account in cases like this, so the crime would just be "stealing a meter's SIM card and using it", which would be the same crime regardless of how much money that cost the utility.
It doesn't look to me like the detention time involved here was computed from the damages. The two issues are orthogonal. We appear to agree on this point.
They are not orthogonal. Amount of estimated damages differentiates between kinds of theft (petty larceny vs grand) and is pretty much directly used to calculate imprisonnement duration in hacking cases. Some 30000 USD/year, IIRC. That's why companies always inflate their damage reports. Severe abuse of justice for the defendant and the company risks pretty much nothing.
Companies "always" inflate their damage reports... but in this instance, the number cited came directly from their upstream billing. Can you square that circle for me?
In non-tech cases, my impression is that upstream billing isn't taken as solid proof of the amount of damage incurred. For example you might have a very expensive contract with a visits-your-house personal mechanic who you've agreed will be your exclusive car-repairer. Thus when you're hit in an accident, you automatically incur a large bill of $X, due to your pre-agreed subscription with the mechanic. But for either civil or criminal damage computation, a court would normally determine how much damage was caused by looking at what the repair cost would've been with a "normal" mechanic at prevailing rates instead.
...meanwhile, neither 1% nor 100% of damages serves society's goal of deterring crime.
I would tend to disagree with this. Having to repay damages removes the benefit associated with the crime, so for ordinary sane people, it would act as a deterrent. In my opinion, jail is more appropriate for crimes where the criminal is likely to be an ongoing danger to society and no other option (probation, mandatory classes, etc.) would have the desired effect.
It's not much of a deterrent if you only pay the damages (assuming a reasonable definition of damages, which apparently doesn't exist here).
You have a nonzero chance of getting away with the crime, in which case you don't pay - so your expected return for the crime is higher than for not committing it. This is exactly the kind of thing that higher deterrents are supposed to prevent.
If the damages were $2 and not $200,000 would you still think an 18 month sentence is justified ?
I would guess that most people would think not.
So the true cost of the damage is a significant factor in assessing the appropriate punishment