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Although the calculation capacity of the computer is increasing fast, the dynamic equivalence which works to generate the reduced equivalent power systems models is still irreplaceable. Coherency-based equivalence has been extensively used in engineering practice. However, there are still no wide-accepted rules or methods to decide the boundary of the retaining system and the system to be eliminated. This paper presents heuristic indices for preserving network decision and performance evaluation in power system dynamic equivalence. For validation purposes, this propose method is applied to a test system of IEEE 10 machine 39-bus system and dynamic equivalence of South China power grid in the year of 2010. Results show that the reduced system retains the dynamic performance of the original system with good accuracy, and the proposed method has good engineering value.