Payback is the first number everyone wants, and it is also the number that varies most. The same size of system on the same kind of roof can come out at 3 years or 9 years depending on the assumptions behind it.
So instead of giving you a single figure, this article walks through the calculation step by step. You can follow it with an ordinary calculator, and you will be able to see which assumptions sit behind any payback figure you come across.
The payback formula is one line
Payback period = total system cost ÷ money saved per year
The hard part is the bottom of that fraction. Annual savings are not simply everything the panels produce multiplied by your electricity rate. They split into two parts — power you use in the building, and surplus power that flows out to the utility grid — and those two parts are worth very different amounts per unit.
Step 1: how many units the system produces per year
In Southern Thailand, 1 kilowatt-peak (kWp) of panels produces about 1,350 units (kWh) per year. That is a full-year average with the rainy season and overcast days already included. The South gets the least sunshine of any region in Thailand, so this figure is lower than values used for the Central region or the Northeast.
A 5 kWp system therefore produces about 5 × 1,350 = 6,750 units a year, or roughly 18.5 units a day on average — more on clear days, less on rainy ones.
Step 2: what share of that power you use yourself
This is called self-consumption: the power the panels produce that is used by appliances in the building at the same moment. Whatever is not used right away flows out onto the utility's lines.
- A home that is empty during working hours, with only the fridge and standby loads running, usually self-consumes a small share.
- A home with someone in during the day and the air-con on self-consumes noticeably more.
- Shops, offices, hotels and factories that operate in daylight can use almost all of it, provided the system is sized to the load.
Self-consumption is not only about habits — it also depends on system size. The more a system is oversized relative to your daytime use, the lower the share you use yourself, because more of the output spills out to the grid.
Step 3: put the right value on each part
- Power you use yourself is worth what you no longer have to buy. We use THB 4.20 per unit, close to the September–December 2026 tariff of THB 3.95 plus 7% VAT.
- Power that flows out earns THB 2.20 per unit if you are accepted into the residential solar buy-back program (Solar Phak Prachachon).
- If you are not in the program, exported power earns nothing, so its value should be counted as zero.
The buy-back program only accepts residential meters, caps what you can sell at 5 kW per meter, and has a national quota allocated first come, first served — applying does not guarantee a place. Shops and businesses on other meter types should count surplus power as worth zero.
The most accurate rate per unit is your own: divide the total on your bill by the units used. Homes that use a lot of electricity often come out above THB 4.20, because residential tariffs from PEA (the Provincial Electricity Authority) rise in steps with consumption. Our article on the 2026 tariff explains this in detail.
Worked example: a 5 kWp home with different daytime use
Same system, same 6,750 units a year — only the self-consumption share changes.
| Daytime self-use | Self-used units × 4.20 | Exported units × 2.20 | Total per year (in buy-back program) | Total per year (not in program) |
|---|---|---|---|---|
| 40% | 2,700 units = THB 11,340 | 4,050 units = THB 8,910 | THB 20,250 | THB 11,340 |
| 70% | 4,725 units = THB 19,845 | 2,025 units = THB 4,455 | THB 24,300 | THB 19,845 |
| 90% | 6,075 units = THB 25,515 | 675 units = THB 1,485 | THB 27,000 | THB 25,515 |
Two things stand out. First, the home that uses 90% itself earns about 33% more per year than the home that uses 40%, even though both systems produce exactly the same units. Second, a home with low self-consumption relies heavily on buy-back income; without a place in the program, its annual value falls by almost half.
For low daytime users, the more effective fix is to size the system down to match daytime demand, or to move some loads into daylight hours — running the washing machine, water pump or EV charger on a timer while the sun is up. Our article on what size of system suits your bill covers sizing step by step.
Worked example: a business that runs in the daytime
Take a shop or small factory with a 20 kWp system producing about 27,000 units a year. It operates through the day and self-consumes 95%: 25,650 units × 4.20 = about THB 107,730 a year. The remaining 5% is valued at zero, because commercial meters do not qualify for the residential buy-back program.
A business that uses power in the daytime gets more value from each unit produced than almost any home. That is why business payback periods are shorter than residential ones.
Businesses on time-of-use tariffs, or tariffs with a demand charge based on peak power draw, need a more detailed calculation. Solar clearly reduces the energy charge, but its effect on the demand charge is unreliable: on cloudy or rainy days, machinery still draws full power from the grid.
What has to be true for a 2–3 year payback
Turn the formula around. For payback within 3 years, the total system cost can be no more than 3 times the annual savings. For 2 years, no more than 2 times.
| 5 kWp home, daytime self-use | Value per year | Maximum system cost for 3-year payback | Maximum system cost for 2-year payback |
|---|---|---|---|
| 40% | THB 20,250 | THB 60,750 | THB 40,500 |
| 70% | THB 24,300 | THB 72,900 | THB 48,600 |
| 90% | THB 27,000 | THB 81,000 | THB 54,000 |
The system cost in that table has to cover everything: panels, inverter, mounting, cabling, protection equipment, PEA permit fees, the engineer's design certification and installation labor. Put these figures next to any quotation you have received and you will see that a very short payback depends on unusual conditions.
Mathematically, payback only shortens toward 2–3 years when several things happen at once: nearly all output is used on site, the rate per unit at that property is high, and the system cost per kilowatt is very low. The last condition is hard to meet for homes, because fixed costs such as the inverter, the control cabinet and the permit paperwork do not shrink with system size. The ranges we actually calculate for customers are in the table at the end of this article.
The three inputs that move payback the most
Whenever you see a payback figure, check these three inputs, because each one directly changes the bottom of the formula.
- Sunshine: does it use more than 1,350 units per kWp per year for Southern Thailand? Other regions have higher values.
- Rate per unit: is it higher than what your own bill shows?
- Self-consumption: does it assume 100% of the output is used on site? That is rarely achievable for a home that is empty during the day.
To see the effect: a 5 kWp home at 40% self-use realistically earns about THB 20,250 a year. Calculate the same system with 1,500 units of sunshine, a THB 5 rate and 100% self-use, and you get 7,500 × 5 = THB 37,500 a year — nearly double. The resulting payback is almost halved, for the same system on the same roof.
One more point: this is a simple payback. It does not deduct long-term running costs such as panel cleaning, or the chance of replacing the inverter after its warranty ends — typically 5 to 10 years depending on the brand. Panels also lose slightly less than 1% of output per year. Together these make real payback a little longer than the simple formula.
The payback ranges we use
| Type | Typical payback | What puts you at the short end |
|---|---|---|
| Homes | 6–10 years | Someone at home in the day, daytime air-con, system sized to daytime use, a high rate per unit |
| Businesses with daytime use | 4–7 years | Continuous daytime operation, nearly all output used on site, a system large enough to lower the cost per kilowatt |
Estimated at THB 4.20 per kWh and Southern Thailand sunshine (1,350 kWh per kWp per year, rainy season included). Actual payback depends on your bill and when you use electricity — we calculate it for your property before quoting.
To see figures for your own property, enter your monthly bill in our payback calculator, or send us your recent bills for an estimate. We will also list the assumptions we used, so you can check the numbers yourself.
Frequently asked questions
Is a 2–3 year solar payback actually possible?
Mathematically, yes — when nearly all output is used on site, the rate per unit is high and the system cost per kilowatt is very low, all at the same time. That combination is hard to achieve for a home. The figures we calculate for homes in Southern Thailand are usually 6–10 years, and 4–7 years for businesses that use power in the daytime, depending on daytime use and the rate each property pays.
How do I know what share of my power I use in the daytime?
The simplest way is to list what runs during the day — how many air-conditioners and for how many hours. If your meter can show hourly consumption, the estimate becomes much more accurate. If you are unsure, stay conservative: around 30–40% for a home that is empty during working hours.
Should I include buy-back income in the calculation?
Run it both ways — with the THB 2.20 buy-back and without it. If the system still makes sense without that income, you are deciding on safe numbers, because the program has a limited quota and only accepts residential meters.
If electricity prices rise, will payback be faster?
Proportionally, yes — but prices can also fall. The Ft (fuel adjustment charge) is reviewed every four months, so we do not assume rising tariffs in our payback figures, and we suggest you base your decision on current rates.
Will a bigger system pay back faster?
Not necessarily. Once the system exceeds your daytime use, each extra unit flows out for THB 2.20 or for nothing. Self-consumption falls and payback gets longer. The best-value size is the one that matches your real daytime demand.
Related services and areas
Keep reading
- Thai Electricity Is THB 3.95 per Unit for Sep–Dec 2026 — How to Calculate Solar Payback CorrectlyThe tariff you see in the news and the rate you actually pay are not the same. Here's how to work out your own real cost per unit so your payback calculation is accurate.
- Monthly Bill of THB 3,000, 5,000 or 10,000 — What Size Solar System Do You Need?The best-value size is not the largest your roof can hold — it is the size that matches the electricity you use during the day.
- Thailand's 2026 People's Solar Program: Selling Power Back at THB 2.20 — Is It Worth It?The program is real and so are the terms, but the THB 2.20 the state pays is almost half what you pay for power yourself. Here's how much selling back actually earns — and why it isn't the main reason to install solar.
- Why Do I Still Have an Electricity Bill After Installing Solar? 7 Causes and How to CheckA bill that keeps arriving after you install solar usually doesn't mean the system is broken — but sometimes it does. Here is how to tell what is normal, what needs checking, and what to look for in the monitoring app.