Jeremy Hunt has appeared to rule out more energy support for struggling families following a desperate plea by Martin Lewis.
The Chancellor faces pressure to act over a rise in bills in April, with the money-saving expert warning of a "national act of harm” which could plunge another 1.7million into fuel poverty.
But Mr Hunt today said there was no space for a "major new initiative" to help households with energy bills.
In November he announced the cap will be increased to £3,000 for the average household in April - but Labour has called for more support funded by windfall taxes on energy firms.
Asked if he was ruling out more support, the Chancellor told reporters: "We constantly keep the help we can give families under review.
"But if you're saying 'do I think we're going to have the headroom to make a major new initiative to help people?', I don't think the situation would have changed very significantly from the autumn statement, which was just three months ago."
Mr Lewis has written to the Chancellor saying he must act to prevent the misery faced by millions of families across the UK.
In a letter to the Chancellor he said the increase was no longer necessary because wholesale prices have "come down very substantially".
He added: "Postponing the increase is a practical and fair decision, with household energy bills already double what they were the prior winter.
“Crucially the damage to people’s pockets and mental health of another round of energy price rise letters is disproportionate."
Under the Government's "energy price guarantee" typical bills are frozen at an average of £2,500 - but will soon become less generous.
Asked why the Government does not halt the rise in the energy price guarantee, Mr HJunt said: "We know just how tough it is for many people dealing with these huge spikes in their energy bills.
"And that's why we're giving about £3,500 for the average family this year and last to help with those pressures, absolutely unprecedented support.
"We always look at what else we can do, but we also have to be responsible with public finances."
He added: "At the same time as energy prices have come down, so too have our receipts from the windfall taxes.
"So we have to look at everything in the context of what is responsible for public finances, because if we don't, we'll just see interest rates go up and then everyone who has a mortgage up and down the country will face a different kind of cost."
Labour has called for the government to step up and bring in new measures to protect struggling families.
Shadow Chancellor Rachel Reeves said the government must bring in "urgent measures" after new figures showed .the UK recorded zero growth between October and December.
She said: "Today's figures show us how - despite Britain's great potential - our economy is stuck in the slow lane.
"We can be a leader in the industries of the future that will help grow our economy.
"And we must bring in urgent measures to prevent yet more harm from the cost of living crisis, using a proper windfall tax on oil and gas giants to stop the energy price cap going up in April so that people have more money in their pockets.
"Built on the rock of economic stability, Labour will tackle the cost of living crisis and get our economy growing, with our Green Prosperity Plan, reform to business rates, and by making the UK the best place to start and grow a business."
