The new target, which is set against 1990s emissions levels, was announced by energy minister Chris Huhne. He also said a 50% cut averaged from 2023 to 2027 would be put into law.
The details of the policy will be set out in October. The government said it would look at ways of reducing the impact on the cost of energy for business users.
Current 2020 targets mean the UK will need to generate 21% of electricity requirements from wind by 2020. In a recent interview with Windpower Monthly junior energy minister Charles Hendry admitted this would be a tough order.
Speaking about the 2023 plan, Huhne said: ""The Coalition Government has set a fourth carbon budget level, in line with the advice from the Committee on Climate Change, that sends a clear signal about our determination to transform Britain permanently into a low carbon economy.
"By cutting emissions we’re also getting ourselves off the oil hook, making our energy supplies more secure and opening up opportunities for jobs in the new green industries of the future."
Separately, Huhne's position is currently under pressure following reports he asked his wife to accept responsibility for breaking the law whilst driving.