The Nelson Mandela Bay municipality has secured more than R280m from the KfW German Development Bank to be used for upgrading electricity infrastructure and renewable energy projects.The money comes in the form of grant funding and will be used for upgrading the city’s electricity network, renewable energy projects and training.This, however, is if council agrees to accept the money.The report was brought to the infrastructure and energy portfolio committee as a flyer – an item not on the agenda – which made opposition councillors reluctant to accept the funding, saying they needed to understand its conditions.The German Development Bank has agreed to give the city R288m in grant funding while the city is expected to contribute about R32m.The municipality has until December 31 2019 to sign the financing agreement or stand to lose the money.In the report, electricity and energy acting executive director Luvuyo Magalela wrote that the city’s power distribution network was between 30 and 40 years old and had not been upgraded in recent years.“The lack of expansion investment has not only bred problems of ageing infrastructure, but has led to high technical losses, power quality [issues], poor customer services, low electricity revenue collection and illegal electricity connections,” Magalela wrote.He further wrote that the state of the electricity networks opened up opportunities for renewable energy.“The modernisation of the existing network is required to maintain the stability of supply and to implement the renewable energy ambitions,” he wrote.The plan is to:● Demolish the 40-year-old Mount Road substation that supplies the inner city and establish a new substation adjacent to the existing site and then transfer the load once construction is complete.● Upgrade the Diaz Road substation as well as the distribution network by replacing the cables and associated mini-substations.● Demolish the Fifth Avenue substation and upgrade cables and associated mini-substations. The new network will be supplied from the recently commissioned Newton Park substation.The renewable energy component could see the municipality provide electricity to informal settlements.Magalela wrote that the pilot project would look at green energy and that close involvement of the community would be ensured.He added that the municipality would involve all relevant departments, including the human settlements department, in the design of the innovative renewable energy component.As part of the training component, the municipality would restructure the electricity and energy department and introduce an energy sub-department that would look after the management, co-ordination and implementation of renewable energy, the development and implementation of energy-efficient projects and the integration of alternative revenue in the form of a business model review.The project is expected to start in January 2020.Infrastructure and engineering portfolio head Andile Lungisa, who pushed for the item to be passed, with no success, said: “This is not a loan, this is what is called grant funding.“It’s free money as we have not locked this municipality into a loan.“The Germans have been our friends for a long time. We have to be responsible as a city and support this.”DA councillor Eric Jinikwe asked that the report be deferred to the next meeting as it was important.But Lungisa said it could not be deferred as there were timeframes that needed to be met. “I am persuading all the colleagues to support this as it has timeframes, the German Bank has said that we are behind [when it comes to making a decision] and we cannot lose this money,” Lungisa said.DA councillor Masixole Zinto urged the committee to interrogate the terms of the grant. “You are committing a city here, this thing will haunt us forever.“We have a privilege as councillors of deciding on behalf of 1.3-million people living in this city, to decide whether or not we commit to an item that has been thrown in our faces today and you are saying let’s take a decision on it.“We need to be serious on the work that we have been given, it’s only fair that we be given the chance to look at this,” Zinto said.Lungisa said should the councillors not support the proposal to accept the grant funding he would convene a special council meeting as he had the numbers needed to win a vote in council.ACDP councillor Lance Grootboom said he would not support the item as there was no comment from budget and treasury.The item was deferred, with Lungisa ruling that he would call a special infrastructure and engineering meeting to debate the matter.