The new measure will mean a household is considered "fuel poor" if they are below the poverty line, once energy costs are factored in, and their energy bills are higher than typical.
Ed Davey said the Government would be carrying out a package of measures aimed at helping the most vulnerable in society - but said a Labour target of ending fuel poverty by 2016 would not be met.
He said the original target to eradicate fuel poverty, set in 2000, was the "wrong type of target to focus on given the nature of the problem".
In a written statement to Parliament, the Energy Secretary said: "We are therefore proposing a new target that focuses on improving the energy efficiency of the homes of the fuel poor.
"It is also clear that we cannot achieve meaningful progress under this new framework against a target date of 2016. We will put forward our proposals on the date, level and precise form of this new target in due course, should our amendments (to the Energy Bill) be approved by Parliament."
He added: "Overall, these proposals will ensure that as we continue to roll out ground-breaking policies to drive improvements to the energy efficiency of the housing stock, the fuel poor are not left behind."
Mr Davey highlighted policies including the Energy Company Obligation, the Green Deal, the Affordable Warmth and Carbon Saving Communities scheme, and the Warm Home Discount Scheme.
He said the Government's efforts were worth almost £2 billion collectively.