O2 is hoping to appeal to the "Green" consumer with a range of new incentives that reward for taking the eco-friendly route.
At the heart of the new "We're in this together" campaign, O2 is offering existing customers who keep their phone a £95 credit as well as giving £10 to O2 Energy Saver fund on their behalf.
According to O2 The total CO2 emission from the production and distribution of an average handset it offers is at least 7.5kg of CO2, which is the equivalent internal space of a family car.
The company suggests that if everyone in the UK who owns a mobile delayed its replacement by a year, it would equate to 187,000 cars being removed from the road annually.
In a further attempt to cut down on waste all bills and services for this SIM-only "paperless" tariff are available via email or online and is available on a 1-month rolling contract basis.
Every customer who signs up O2 will make a £5 donation to the O2 Energy Saver fund.
The company say this is the first of other environmentally products to be launched by the operator following on from a working agreement with Nokia over the trial of a "letter box friendly" package for its phone deliveries.
The new package removes the need for the postman to leave a card and the customer having to go and pick the phone up from a sorting office, or for a courier to make multiple visits.