Issues on the establishment of equivalent networks are becoming essential f
or the deregulated power market. This paper presents a comprehensive tool f
or network reduction of large power systems. Through integrating different
methodologies into a simulation program, the dynamic equivalent can be esta
blished by adopting one common database. With a readily integrated modified
Gauss-Newton algorithm, network reduction can be executed tinder the dynam
ic conditions either in the time domain or in the frequency domain in copin
g with nonlinear nature of the system involved. Furthermore, a novel algori
thm based on dynamic coherency approach implemented readily into the simula
tion program is also presented. This novel approach determines coherent gen
erators on non-linear basis in the time domain using the cross correlation
technique, taking dynamic characteristics of the system involved into consi
deration. Two case studies are presented in this paper. Each of the non-lin
ear approaches presented is applied for one of the case studies as applicat
ion example. The results achieved validate the functionality of the approac
hes presented.