Aberdeen, the centre of the UK’s North Sea oil and gas industry for the past six decades, witnessed the launch of a new company this week that aims to sweep away Britain’s dependence on fossil fuels for ever.

Great British Energy is at the heart of the recently elected Labour government’s pitch to decarbonise the UK’s power sector by 2030. Ed Miliband, the energy secretary, told an audience in Aberdeen on Thursday that the company would “harness the potential we have to truly lead the world in renewables jobs”.

With £8.3bn in new government investment, GB Energy is one of the few new spending commitments Labour is planning, amid consternation among ministers over swingeing cuts elsewhere. But the crucial decisions that will determine whether GB Energy can be a success, or not, will be taken far from Aberdeen, in London’s No 11 Downing Street. Rachel Reeves, the chancellor of the exchequer, is finalising her first autumn budget, set for 30 October, and experts fear that though the money for GB Energy will remain intact, she will place such tight restrictions on the company as to effectively cut off its lifeblood.

What’s the plan for Great British Energy?

Great British Energy is one of the most recognisable and popular of the policies that brought Labour to power in July’s general election. A national energy champion, in contrast to the foreign-owned companies that dominate the UK’s energy scene; a company owned by the people of Britain that will invest in a new generation of renewable energy supply; a plan that will cut the UK’s carbon footprint while reducing household bills.

The company will be led by Jürgen Maier, former UK chief executive of the engineering company Siemens, and a longstanding champion of clean technology. With £8.3bn in initial funding, GBE is one of the government’s few remaining green spending pledges, after Labour’s initial plans for a £28bn a year public investment in a “green industrial strategy” were gutted in February.

Offshore wind, including revolutionary floating turbines, tidal power, carbon capture and storage, hydrogen and other emerging technologies will be the focus of the company’s investments. Maier wants GBE to stand alongside globally significant players such as Denmark’s national clean energy company, Ørsted, and Sweden’s Vattenfall.

But when Reeves stands up in parliament on 30 October, she is unlikely to give Maier the boost that many experts say is needed. The Guardian understands that the Treasury is determined to keep GBE within tight fiscal controls. That means it will not have the powers to borrow new money to invest, lest any debt that it accumulates could be counted towards the government’s massive debt pile, and upset delicate calculations on Reeves’s fiscal rules.

Failing to give GBE the freedom to borrow would be a crucial mistake, according to Mathew Lawrence, the founder and director of the Common Wealth thinktank, credited with coming up with the original idea for a national energy company. “Reeves should exempt GBE from public sector net borrowing rules,” he said. “She can do that.”

Maier is more circumspect. He appears to still hold out hope of a change of mind from the Treasury at some point, telling the Guardian: “Whether in the future we can borrow or not, I think is a discussion for later on.”

Reeves also seems to prefer GBE to take minority stakes in large renewable energy projects. That too is a problem, according to Lawrence. “GBE should take majority stakes, in order to have control over these projects,” he said.

According to Lawrence, the key benefits that GBE can deliver to boost the UK’s green energy sector are: cost, coherence and certainty. On cost, GBE can lower costs by using the government’s might to invest capital more efficiently and at lower interest rates than private companies can access.

Coherence means that the government can take an overview of the UK’s energy needs and invest strategically to meet them, unlike private companies, which can only take a piecemeal view. Certainty reflects the fact that the government is driven not by short-term profit like the private sector, but by a long-term goal of decarbonising power, which gives a clear future direction that all its investments and policies must work towards.

Industry is ready to work with the government, the Guardian has found, but businesses want to see more clarity from ministers over the plans. One senior industry source told the Guardian that “increasingly there is a meeting of minds” between investors and government officials over the role for the new entity.

That marks a change in attitude, as GBE was initially a cause for concern among businesses. Senior executives within Europe’s largest energy companies feared that a state-backed enterprise would lay claim to preferential treatment in the government’s clean energy schemes – and potentially edge out private capital. Miliband has been quick to reassure the industry that GB Energy would seek to “crowd in” new investment rather than crowd it out.

Emma Pinchbeck, the chief executive of Energy UK, the industry’s trade body, who is shortly to take up a new role as chief executive of the Climate Change Committee, the statutory adviser to ministers on climate policy, said the public energy company had “great potential to advance the UK’s clean energy ambitions” if it tried to “support and complement – rather than duplicate – the investment, expertise and experience of the private sector”.

“Kickstarting the development of newer technologies and supporting community projects while larger and established sources like wind and solar continue to grow, would also fulfil an existing need,” she said.

Which areas will it invest in?

GB Energy’s first step has been in the direction of Britain’s world-leading offshore wind sector. It has included a partnership with the crown estate, which aims to accelerate the build-out of enough giant offshore windfarms across the estate’s seabed off the coastlines of England and Wales to power 20m homes.

Through this partnership GB Energy will undertake early development work on sites before the seabed licences are granted to windfarm developers to help speed up the process. In exchange it will claim a small stake in the windfarm. This is expected to accelerate the £60bn of private sector investment in the government’s green energy goals – and deliver healthy returns for GB Energy.

Keith Anderson, the chief executive of Scottish Power, which recently doubled its spending plans for the UK for the next four years to £24bn, said: “More than ever, the government is heading in the right direction. If targeted properly, GB Energy will directly support [the 2030 clean energy target] by producing a plan we can all get behind and deliver.”

There remains uncertainty over which areas the government will target beyond offshore wind. Anderson believes that emerging technologies – controversial with many environmentalists – such as green hydrogen and carbon capture and storage are ripe for “tailored support” from the government, which could include investment from GB Energy. “Funding for Britain’s ports will also speed up the development of offshore wind and create growth for coastal communities,” he said.

Greg Jackson, the chief executive and founder of Octopus Energy, pointed to long-duration energy storage as another example of currently underfunded emerging technologies where GB Energy could “unlock private capital through co-investment”.

Ahead of the budget, investors are less concerned about the amount of public sector funding available than about gaining clarity around the government’s plans, and the policies and regulations which will underpin them.

“Whether investment comes from the government or from the private sector – the key thing is policy,” said Jackson.

GBE is also critical for Scotland, for the 200,000 jobs in North Sea oil and gas, which Labour is anxious to reassure voters will still be stable for decades to come. Aberdeen was chosen as headquarters for political reasons: to help offset the complaints from North Sea oil and gas companies about the Treasury’s decision to increase windfall taxes, partly to fund GB Energy, and Miliband’s determination to block new oil exploration licences – complaints the Scottish Conservatives and Scottish National party have amplified.

The UK government also faces a further stiff test next summer, when 400 oil industry jobs will be lost with the closure of Scotland’s only oil refinery at Grangemouth, with over 2,000 more in the supply chain threatened.

That is intensifying pressure on the Treasury to properly fund projects on the so-called just transition, where unemployed oil workers are helped to find new jobs in the green economy, including new college courses or a government-funded “skills passport” where oil workers can transfer their oil industry skills to renewables.

Senior Labour sources in Scotland said they wanted to see progress on cutting household electricity bills and new rules to ensure communities that host these new green energy projects, including the new pylons and subsea cables needed, get a share of the profits.

Michael Shanks, a Scottish MP who became a junior energy minister in July, told UK Labour conference in Liverpool last month that “quite significantly” improving these community benefit schemes was a priority – including giving them a direct stake in GB Energy projects.

“We want to look at how communities can be in the driving seat of some of that. So instead of developers deciding what that looks like, it should be compulsory, but also a community has some stake in designing it. And that goes for network infrastructure as well, not just the generation,” he said.

A senior Labour figure said there were early indications the Treasury would authorise spending on enlarging Scotland’s coastal ports, which are ill-prepared for the huge wind turbines and installation vessels needed for the vast new offshore windfarms being planned.

The Scottish Trades Union Congress has told Labour ministers GB Energy needs to focus a significant proportion of its investment in Scotland, because a disproportionate number of North Sea jobs are there.

Roz Foyer, the STUC’s general secretary, said 84,000 Scottish workers depended on oil and gas jobs, while the numbers employed in renewables, estimated at 6,000 people, had barely risen in Scotland over the past decade despite the heavy investment in windfarms. “The investment in GB Energy has to go disproportionately to Scotland because of the disproportionate amount of oil and gas jobs that are going to be lost,” she said.

Decarbonising UK electricity by 2030 will be a stretching target – even if new renewables are built swiftly and grid connection problems resolved, a small amount of gas-fired power is still likely to be needed. But experts told the Guardian that even if the target was missed, the effort should put the UK on track to meet net zero and help dispense with volatile fossil fuels. Shaun Spiers, the executive director of the Green Alliance, said: “Lots of questions remain, but the government has hit the ground running in setting up GB Energy to speed the transition to clean power, and that should be strongly welcomed.”