When we purchased our land with well, neighbors on adjoining property used for hunting cabin on land with no well agreed to pay the electric bill for the well for both properties so they could use the well instead of installing their own well.
After these people gave up this rental one of their relatives took over the lease and we continued with this allowing them to use the well in exchange for electric power to run well for both properties. This continued for another several years.At that time they decided they no longer wished to pay the electric for the well requesting that we begin paying our own electric to the well.They maintained they still wished to use the well but since there can only be one source of electric to the well I assume they felt we should pay the electric as well as provide them with water.we did as they requested and switched the well totally over to our power and since our agreement with the original party was electric for water we disconnected them from our well.was the original agreement legally binding ? What about the transfer to the second party? When they instructed us to remove them as the power source for the well and we complied

I think everyone "assumed" something. "Assuming" is not the same as having an agreement, an understanding, an oral contract.

Where is important - your location?

Where is in South Carolina .we were instructed to take the well off their power and connect to our own .we complied with their request.It seems this means they failed to keep their side of any agreement .Am I incorrect?

You had an agreement with the first owner, it ended when the property transferred owners, You need to get a written agreement with them, on the specifics of this.

Since they did, it appear pay the electric for a number of years, it is proof they were aware of and did agree to this.

The issue here, is that, did you notify them, that if you changed the electric and they no longer paid, the water would be cut off.

At this point, since you provided water for so many years, it may be possible, they can make a case that you will need to sell them water, so you may need to offer to provide them water at a specific cost each month, if they refuse, then that is their choice.

Did they KNOW, and UNDERSTAND that there would be no water when they stopped paying

An agreement does not become an oral contract unless both parties benefit AND there is a clear understanding of the terms and conditions.

I don't think you have that with other (current) party.