The payback periods get me confused. A relative set up solar a year ago in one of the sunniest places in Europe, the Canaries, cost €7,000 for 6KW. He just ran the math on it and found out that the payback period is 15 years. The only way to make it profitable is government subsidies. How can it be profitable to install solar in continental Europe where taxes and labor costs are much higher while having much less sun? Why are we using taxpayers' money to subsidize such negative NPV projects?

Your comment appears to be unrelated to Pakistan and, due to the confusion of units, has been reduced to nonsense. Moreover, your implied calculations don't work out.

If we assume that you meant €7000 for 6 kilowatts peak (not 6 kelvin wurtzite henries or 6 kilowatt hours, neither of which is sensible) the probable answer is that your relative paid 25× the current market price for their solar panels and therefore got 25× the payback time. However, if we assume €0.12/kWh and a 20% capacity factor, 6 kilowatts peak would average 1.2 kilowatts, which is 10520 kWh per year, which works out to €1260 per year, which would be a payback time of 6 years, not 15 years.

Moreover, another way of saying that the payback time on a durable investment is 15 years is that the investment returns 6.7% per year. That would be a highly profitable investment, even without government subsidies.

Those numbers sound wrong.

I have 7.8kw in Canada, and if I paid out of pocket payback would be 6-7 years.

We pat $0.13 per kWh from the grid, get a one for one credit on anything we feed in. System makes 7.8Mwh in a year.

What are your friends numbers?

Grid price is also pre-approved to increase not less that 5% a year forever, so it will only go in my favour.