Cameron last week moved Hayes, a staunch Conservative Party skeptic of wind power's costs, into his Privy Council as a minister without portfolio, while replacing him with fellow Tory Michael Fallon.
Hayes had long clashed with Ed Davey, the Liberal Democrat Secretary of the Department of Energy and Climate Change, over the direction of Britain's energy policy as the government worked on its Energy Bill, which in December had its second reading in Parliament and is awaiting royal assent.
The Energy Bill plans to use a mix of fines levied on polluters and provides green subsidies to wind, nuclear and renewable energy developers to replace coal-fired power stations with costlier, low-carbon alternatives.
It comes as the European Union has formally opened the debate on setting greenhouse gas-reduction goals for the 2020-30 period. Britain hasn't declared its support for defining 2030 targets, causing nervousness among green energy companies seeking assurances there will be future markets for their electricity.
Seven major electricity and nuclear technology firms threatened in October to cut back future investments in Britain amid widespread reports of rifts between Hayes and Davey over subsidies for onshore wind power development.
Areva, Siemens, Alstom UK, Mitsubishi Power Systems, Doosan, Gamesa and Vestas all warned Davey in a letter obtained by The Telegraph the lack of a resolution on whether to back ambitious 2030 greenhouse gas reduction targets has "caused us to reassess the level of political risk in the U.K."
Hayes "had some ferocious clashes" with Davey, The Guardian reported, which at one point prompted Davey to write to Cameron demanding that Hayes be taken off the wind farm portfolio because his "prejudices were exposing the department to a very high risk of judicial review."
In an October interview with The Telegraph he sided with local communities opposed to wind power projects, saying, "Enough is enough."
Fallon, meanwhile, is the current Minister of State at the Department for Business, Innovation and Skills and will add the DECC post to his portfolio, signaling a closer integration of green energy and overall business policies.
In a release announcing the move of Fallon to DECC, Davey said he was "delighted to welcome Michael Fallon to DECC. He brings with him a wealth of business experience and will make an excellent addition to the team.
"He will help to cement the links I've been making across government as energy is such a critical industry for the U.K.'s growth prospects, and the creation of green jobs."
The opposition Labor Party, which is currently leading in polls in the run-up to May 2014 local elections, called on Fallon to commit to binding 2030 greenhouse gas reduction targets.
"Investors are seeking clarity on long-term political commitment post-2020 when the current suite of targets expires," Member of Parliament Barry Gardiner, Labor Party leader Ed Miliband's special envoy for climate change and the environment, said in a statement.
"If the new minister wishes to show that he understands this, then he can make a profound impact on his new department by announcing his support for a 2030 decarbonization target as set out in the cross-party amendment tabled by myself and (Conservative Party MP) Tim Yeo."
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