I didn't use them much, but the once or twice I did I encountered that problem. It's been a while back, so let me see if my memory can dredge this up...
-5 per PP invested.
Elemental Bolt has a base cost of 5 PPs (I think it was 4 in earlier versions), so you have a minimum +25 for skill when casting it. Each PP worth of scaling also requires an extra minimum rank. So just figuring skill and scaling penalty and assuming everything else is the same across the board...
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In short, if you scale past Medium attack size, you've already hit a diminishing return.
Sorry, but I don't think this is the problem as most players who wish to play a powerful magician increase their ranks in their main offensive spell. I think the main problem is the casting time:
Let's assume we have a magician with 15 ranks in Elemental bolt: Fire. This would result in a rank bonus of 60. Plus a good stat bonus of 20 would result in a total bonus of 80. The magician faces an Orc (M size) and he has to cast a spell in one round (if he had more rounds, he could cast the tiny bolt more than once, making even more damage).
So, now assume the dice roll (e.g.: 50) and the DB of the victim (e.g.: 50) is identical, so we have a net result of 80 - let's look at the H&S tables:
Tiny Bolt: 5PP (1 rnd) => 80 - 0 - 0 => 80 => 5 H => 14 hits, 2 stunned, -15
Small Bolt: 7 PP (2 rnds) => 80 - 10 - 10 => 60 => 8 F => 15 hits, 1 stunned, -10
Medium Bolt: 9 PP (2 rnds) => 80 - 10 - 20 => 50 => 10 F => 17 hits, 1 stunned, -10
Large Bolt: 11 PP (3 rnds) => 80 - 20 - 30 => 30 => 9 D => 14 hits, 0 stunned, -5
Huge Bolt: 13 PP (3 rnds) => 80 - 20 - 40 => 20 => 9 D => 14 hits, 0 stunned, -5
You see the same spell will get worse the more PP you invest to boost it, because of the "time reducing" casting Penalty, else it remains more or less identical. My "workaround" for this problem were two small changes:
1) Reintroduce very high damage caps, to prevent the killing blow for Tiny and Small. Tiny: 110, Small: 120, Medium 130, Large: 140, Huge: None
2) Remove the Large & Huge tables and reduce the size of the spells if the opponent is larger than medium by 1 or 2. (e.g.: Medium Bolt vs. Huge Enemy => Tiny Bolt).
These two changes resulted that the players scaled the spells sometimes. Of course, most of the time they still used tiny, but that was ok for me. Sadly, I never found a really satisfying workaround.