Are consumers willing to pay more for green?
In some cases, the answer is clearly yes. For example, organic food tends to be more expensive than “industrial” options. There are additional examples as well. Most, however, tend to be cases where the consumer gets some additional benefit (e.g., healthier food) and/or where the consumer is able to make some public statement about his or her “greenness” (e.g., purchasing a hybrid vehicle).
Unfortunately, in other cases, green premiums appear to be a tougher sell. For example, as reported by SiliconValley.com:
A 2-year-old PG&E program to help customers offset the size of their carbon footprint has drawn little interest and consumer advocates are arguing it should be allowed to expire at the end of the year.
Only 30,000 households and businesses have enrolled in “ClimateSmart,” which allows residential and commercial customers of the San Francisco-based utility to add a tax-deductible “donation” to their monthly bill that allows PG&E to buy carbon offsets.
Based on this example, it would appear that the vast majority of consumers aren’t willing to support green (by paying extra) when there isn’t a direct benefit.
It would be interesting to see what could be done with this program if some real consumer marketing muscle were applied. If participation were turned into a badge of honor, we would wager that participation rates would be dramatically higher.
