Updated: Business minister Ed Davey replaces Huhne as energy secretary

Liberal Democrat MP Ed Davey has been confirmed as the new secretary of state for energy and climate change, after Chris Huhne stepped down from the post to fight criminal charges.

Deputy Prime Minister Nick Clegg today announced that Davey would take up the cabinet role, moving from his current position as minister for employment relations, consumer and postal affairs in the Department for Business Innovation and Skills (BIS).

Clegg said the MP for Kingston and Surbiton would be the "right man for the job", maintaining Davey had a "lifelong commitment to environmental and green issues" and that he had shown a formidable grasp of government policy".

He paid tribute to Huhne's "groundbreaking policies" and left the door open for him to return to "a key government position" if he avoids prosecution.

Davey has in the past voted strongly for laws designed to tackle climate change, including backing plans to bring aviation and shipping into the Climate Change Act. He also backed a law that would cap emissions from power stations.

He is seen to have done a good job in his current role, one that has been described by some onlookers as a "poisoned chalice" for requiring close dealings with the Royal Mail and Post Office.

Green businesses are now hoping Davey will show willingness to engage with industry to help drive the low-carbon agenda. He will also be expected to show the same determination and passion as Huhne demonstrated to tackling climate change both at a national and European level.

He will be responsible for confirming the package of Electricity Market Reforms, overseeing the start of the Green Investment Bank and the launch of the Green Deal. He will also be expected to lead climate change negotiations at the United Nations conference of the parties in Qatar at the end of this year.

Speaking at one of his last public appointments as energy secretary on Tuesday, Huhne said he was optimistic that EU member states would this year agree to more ambitious emission reduction targets – something that Davey will be expected to champion.

David Symons, director at environmental consultancy WSP Environment and Energy, said he was optimistic the new minister would support green industries.

"Ed Davey has previously stated the importance of immediate action on climate change. These beliefs, coupled with his experience in BIS on consumer choice, bode well for DECC's key policies, such as the Green Deal," he said.

James Cameron, founder and vice chairman of Climate Change Capital, said the UK needed a strong advocate of green policies to help boost the economy and cut global emissions.

"We hope Chris Huhne's successor continues his good work in pushing for credible, long-term and cost-effective policies able to make the UK cleaner, safer and more competitive.

"Chris was a staunch advocate in Cabinet of the changes Britain needs to make to be competitive, and a world leader in new green technologies."

Simon Birkett, founder and director of Clean Air in London, said he expected Davey to be a strong advocate of green policies.

"Ed Davey's appointment is excellent news for Londoners worried about air pollution as he really 'gets it'. Let's hope he starts by reforming the Renewable Heat Incentive and insisting Defra reforms the Clean Air Act for modern technologies and fuels," he said.

A spokesman for the Department of Energy and Climate Change confirmed the appointment and said he expected the new energy secretary to make a statement in due course.

In other reshuffle changes, Norman Lamb MP will become parliamentary under secretary of state at BIS, and Jenny Willott MP became an assistant government whip.