The Liberal Democrats are claiming to have won a victory in the now open warfare with their Tory coalition partners over green energy in the form of a new mandate that would require the National Grid to expand the amount of energy generated from renewable sources.

The chancellor has vetoed the original Lib Dem plan to introduce a de-carbonisation target before the next election, but the energy secretary, Ed Davey, claims that the Treasury has sanctioned him to give advice to the National Grid on the need to prioritise renewable energy, adding that it is implausible that the National Grid will not follow these very clear signals. He says he now intends to use that power within months to send the message "very clearly" to increase the ratio of green energy consumed.

In a Guardian interview Davey also states publicly for the first time that he asked the prime minister to remove responsibility for green energy from his energy minister John Hayes, a known anti-windfarm campaigner.

He wrote to David Cameron warning him that if Hayes continued in the role they would be open to legal challenge over any decision he made on the subject.

Davey sought legal advice from his department, which confirmed that Hayes's presence increased the danger of the department's decisions on renewable energy being exposed to judicial review.

The formal warning was sent to the prime minister's private secretary by Davey's private secretary. Davey told the Guardian he feared even an unsuccessful legal challenge could be disruptive at a time when the government was trying to create certainty for energy investors. Davey had wanted to remove Hayes from all responsibility for renewables.

The prime minister rejected that formal warning and refused to remove Hayes from his post.

In the interview, ahead of the publication of an energy bill next week, Davey also:

• Insists that energy prices overall will be 7% lower than they otherwise would have been in the medium term as a result of government policy, even if prices in real terms may rise due to the worldwide energy market.

• Rejects talk of a government-sanctioned dash for gas as overblown, even if he concedes the Conservatives will big this up.

• Says shale gas will not have a significant short-term contribution to the UK energy mix.

The dispute between Davey and Hayes over the role of onshore windfarms in the energy mix spilled out into the TV studios and became so intense that at one point, Davey discloses, he felt compelled to seek legal advice on whether Hayes's approach was making the department liable to accusations of bias and judicial review.

In the wake of the cabinet reshuffle, and the appointment of Hayes as minister of state replacing Charles Hendry, Davey took control of overall charge of renewable energy strategy. He also removed planning and consent policy from his portfolio and gave it to the other Conservative energy minister, Greg Barker, leaving Hayes in charge of renewable energy deployment.

In candid remarks, Davey said: "When he made his statements against coalition policy, I did think there was a question mark whether he should even continue to have responsibility for renewable energy deployment. I asked the legal department here whether there was a danger John had prejudiced himself because he had made these statements, and they said there was a danger.

"They said they could not say it would end up in judicial review, and challenging decisions in which he was involved, but there was a greater potential danger. As a result my private secretary wrote to the prime minister's private secretary, and that letter pointed out that John had not kept to coalition policy, and there could potentially be implications even though he had a smaller role in renewable energy policy.

"I left the decision with the prime minister. He has not written back formally, but I think it is fair to guess that he has come to the conclusion that renewable energy deployment could stay with John. I can only assume because I have pointed out to him there could have been legal issues he has decided the risk is quite small."

He added: "It was not clear cut where the judicial review might come, but there was still potentially a danger because he could be seen as part of it, so someone could make a challenge and, even if it is an unsuccessful challenge, it could be disruptive and what we are trying to have is certainty and clarity."

On the new powers to advise the National Grid on green strategy, he said: "The National Grid will expect guidance from government on what we expect them to do to prepare their delivery plan. I will be writing to the National Grid with that guidance and part of that will say we need to de-carbonise the power sector 'at the least-cost pathway' to meet our 2050 obligations.

"The 'least-cost pathway' tends to show you need to de-carbonise the power sector quickly and ahead of other sectors because that allows you also to de-carbonise transport and heating. The chancellor has agreed that I can be explicit in my guidance, and even if it is non-binding, it is rather implausible to suggest the Grid won't follow it. I think we can send the signal very clearly."