To enable the natural monopoly to engage in aggressive price discrimination, thereby creating a market outcome where consumer surplus is maximized despite the higher production costs associated with natural monopolies.

To incentivize the natural monopoly to expand its market share by allowing it to earn exceptionally high profits through economies of scale that encourage overproduction and market saturation over time.

To ensure that the natural monopoly increases its output far beyond the point where marginal cost equals marginal revenue, thereby forcing the market into a state resembling perfect competition.

To limit the firm’s ability to earn excessive profits and ensure that prices reflect a fair return for consumers, even though the firm may only break even by earning normal profits.