I'd prefer they just discount until 20th and carry the rest over to the next race. If he does qualify in the top 10, say p8, he starts p20 and carries over 32 grid places into the next race.
The current system means they can take advantage of a new PU without having to put any wear on it for qualifying and they'll probably take it easy in the race as well.
The only downside here is that it favours good qualifiers because they will be through their penalties quicker.
That seems too harsh a penalty, it makes using an additional PU likely to mean starting from the back for ~5 races. It'd also hurt smaller teams worse - if your average qualifying position is 16th you'd be starting from the back for about 12 races.