in chapter 7 what are the real reasons behind the council's regection and fear of the gift?

THe fear change and upsetting the status-quo. If they show interest in this new invention, they undermine the society they rule over; Electricity threatens the structure of their society. Equality will show himself to be brighter than his station in life, candles will no longer be needed, and the council will have to concede that they don't know everything.