The British Department of Energy and Climate Change said British households are having a difficult time paying energy bills.
"The government cannot control volatile world energy prices but it is taking action to help people get their bills down," the DECC said.
The department said was proposing a limit on fuel tariffs so consumers can move away from what the DECC described as "poor-value dead tariffs."
The measure comes amid public frustration with price increases for natural gas and electric power. Prices are increasing faster than the rates of average household incomes.
"I am determined to ensure all consumers get a better deal on their energy bill and get the cheapest tariff they can," Davey said in a statement.
He said the tariff proposal would be easier for consumers to understand, which would translate to better deals for utilities.
"For too long people have been stuck on the wrong type of energy tariff, paying more than they need to," Davey said.