It becomes common practice to reduce a large-scale power grid into a simplified one using transient stability simulator and have it modeled on electromagnetic transients programs. However, the procedure of network reduction may produce negative resistance, which may result in some problems in electromagnetic transient simulation. This paper firstly demonstrates that the negative resistance will probably lead to numerical instability in electromagnetic transient simulation. And then the forming mechanism of the negative resistance during network reduction using Gaussian Elimination is revealed. Several schemes for negative resistance elimination are presented at last.