Taxes do influence people's habits. Just look at the influence of the cigarette tax. Self imposed taxes do not always influence or "put money where your mouth is". Massachusetts gives the option to taxpayers to pay the previous higher tax rate. Less than 1% actually figure their tax at the higher rate. There are certainly more than 1% that complain about the state budget cuts.

Environmental taxes do influence consumers. Look at the cost of gasoline in Europe vs the US. Europe pays about 4X the price in the US, mostly due to taxes. Taxes account for 60-80% of the price of gasoline(20% of Germany's revenues are from the gas tax). This influences the amount of gasoline consumption. If the price of gasoline in the US was $4-5/gallon, I would buy a hybrid and cut back on driving. However, it would take a strong willed environmentalist to hand over an extra $2-3/gallon voluntarily.

I suspect that this is one of those ideas with great intention, but dubious outcome. Mandatory taxation does work, as the gas tax example shows, but that will not necessary be the case if the taxation is voluntary.

Most people using this functionality would over time adjust the “taxation” limit to a level which they are comfortable with, and so that they are not nailed every month. Therefore, their behavior will adapt to keep their lifestyle from changing very much. And to put the cherry on the cake, they will have a perfectly logical rationale for why they are doing so!

“Most people” in this example includes you and me. The problem is that most human reasoning (up to 95%, it is claimed) is closely tied to the unconscious and thus to emotion. We all do such things (like fooling ourselves) much more often than we realize, even if we like to call ourselves rational.

Now, a variation of this could work – a sort of local community initiative. In this case the community would get together and decide on such a “voluntary taxation”. This way, individuals would not be able to back out without the community’s OK, therefore applying some real peer pressure.

The extra money gathered should then go to a pool over which the community would have some say in how it should be applied.

You can already do this! I would love to see Ian implement his plan. Go ahead and send the money to some environmental agency and then post a copy of your check (or send me a picture of it and I'll post it.) and then let's see how many people choose to follow through.

It would be easier if the utility helped you enforce it and just charged you the inflated amount. But I guess you're right. You could just promise to pay a charity, say, twice what ever your electricity bill was and promise to give the charity access to your bill. The promise would be enforceable.

Or even without the charity's help, you could just personally commit to it. My spouse and I are successful at living up to our commitment to give 5% to charity. I guess there is no reason why we couldn't be just as successful as living up to a promise to give twice our utility bill amount to charity.

A better idea - an energy company that offers people solely "green" energy. More costly, but a choice you only have to make once.

Google: green electric energyCheck out Green Mountain Energy in particular.

I really like the idea of using your contribution to bring others into the system (basically an assurance contract or challenge grant)

I also like the idea of having it tied to your consumption, and being set up beforehand.