Why has NPS chosen daily settlement, what are the benefits for the participants?
Daily settlement was introduced in 2004 and replaced the weekly settlement period. The main advantage with this transition was that the buyers in the market had their collateral calls reduced by almost 70% thus freeing liquidity tied up in collateral calls to Nord Pool Spot. For the sellers in the market the advantage is that they are now receiving their payments after 2-3 days instead of after 1 ½ week.
