Cost Optimization

Purchasing reserved instances (RIs) is a great way to receive a significant discount on the hourly prices for instances and maximize your pricing alternative. Based on your EC2 compute usage history, instances that are running On-Demand more than 50% of the time should be identified and you should consider purchasing reserved capacity for them. Of course, rightsizing your instances must always be done before making any RI purchase.

Example: Instance MTD On-Demand Hours > 500 hours

Sample Identified RI Purchase policy: Policy monitors your month-to-date on-demand usage to see if there is an opportunity to reduce your AWS cost by purchasing Reserved Instances for one or more EC2 instances.

Variant

• Notify when any instance usage of %Reserved is less than 50% for at least 1 month

These policies can be used to track and optimize the benefits of your reserved instances. They can help correlate those benefits to meet your changing business needs as your cloud footprint grows and changes.

Sample Modify RI Policy: This policy can execute any possible EC2 RI modification when the savings resulting from the modification exceeds a certain ($) amount. This policy will also alert specific users when the RI modification has been executed.

Variant

• Notify when any instance usage of %Reserved is less than 50% for at least 1 month

Sample Underutilized RI Policy: This policy notifies when RIs are underutilized during hourly usage. The first notification is flagged as a warning (i.e., underutilized RI hours MTD > 1 hr) while the second one is flagged as critical (i.e., underutilized RI hours MTD > 5 hr).

Sample RI Hour Utilization Policy: This policy notifies when RIs are underutilized based on wasted monthly cost. You can create increasing flag levels for the notifications before taking action.