By default, balred discards the states with that make the smallest contribution to system behavior, altering the remaining states to preserve the DC gain of the system. Setting the StateElimMethod option to Truncate causes balred to discard low-energy states without altering the remaining states. Which method you choose depends upon what dynamics are important to your application. In general, preserving DC gain comes at the expense of accuracy in higher-frequency dynamics. Conversely, state truncation can yield more accuracy in fast transients, at the expense of low-frequency accuracy.