EC2: Billing and Purchase Option

Connect with me on LinkedIn! EC2 Instance Purchase Options There are seven types of EC2 instance purchase options: On-Demand Instances – These instances are billed by the second when launched. You can pay for the instances per hour or per second, with a 60-second minimum. No commitment is required for such instances. Savings Plan – These instances offer a discount when a commitment of 1 or 3 years is made to use a consistent amount per hour. Use this option when you can commit to consistent usage but do not require a consistent configuration. Reserved Instances – These instances offer a discount when a commitment of 1 or 3 years is made to keep the same configuration. Use this when you need a consistent configuration and capacity reservation. Reserved Instances are offered at up to a 75% discount. While not deprecated, AWS encourages using the Savings Plan instead of Reserved Instances as the preferred way to save on EC2 instances. Spot Instances – These are heavily discounted instances that utilize unused EC2 capacity with no commitment. They are useful if your applications can tolerate interruptions. Spot Instances are offered at up to a 90% discount off the On-Demand price with no prior commitment. Dedicated Hosts – These are entire physical hosts fully dedicated to running EC2 instances. Discounts are available for existing per-socket, per-core, or per-VM software licenses. Dedicated Instances – These are instances running on single-tenant hardware. Dedicated Hosts and Dedicated Instances are useful when software compliance requirements necessitate isolation. Capacity Reservations – This option reserves capacity for EC2 instances in a specific Availability Zone. Capacity reservations are billed at the equivalent rate of On-Demand instances, whether they are used or not. Connect with me on LinkedIn! In my next article, I will be writing about how to choose the appropriate billing option. More to read: EC2 Instance Store: High-Performance Temporary Storage for Your Workloads EC2 Configuration options

Apr 3, 2025 - 03:54
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EC2: Billing and Purchase Option

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EC2 Instance Purchase Options

There are seven types of EC2 instance purchase options:

  1. On-Demand Instances – These instances are billed by the second when launched. You can pay for the instances per hour or per second, with a 60-second minimum. No commitment is required for such instances.

  2. Savings Plan – These instances offer a discount when a commitment of 1 or 3 years is made to use a consistent amount per hour. Use this option when you can commit to consistent usage but do not require a consistent configuration.

  3. Reserved Instances – These instances offer a discount when a commitment of 1 or 3 years is made to keep the same configuration. Use this when you need a consistent configuration and capacity reservation. Reserved Instances are offered at up to a 75% discount. While not deprecated, AWS encourages using the Savings Plan instead of Reserved Instances as the preferred way to save on EC2 instances.

  4. Spot Instances – These are heavily discounted instances that utilize unused EC2 capacity with no commitment. They are useful if your applications can tolerate interruptions. Spot Instances are offered at up to a 90% discount off the On-Demand price with no prior commitment.

  5. Dedicated Hosts – These are entire physical hosts fully dedicated to running EC2 instances. Discounts are available for existing per-socket, per-core, or per-VM software licenses.

  6. Dedicated Instances – These are instances running on single-tenant hardware. Dedicated Hosts and Dedicated Instances are useful when software compliance requirements necessitate isolation.

  7. Capacity Reservations – This option reserves capacity for EC2 instances in a specific Availability Zone. Capacity reservations are billed at the equivalent rate of On-Demand instances, whether they are used or not.

Connect with me on LinkedIn!

In my next article, I will be writing about how to choose the appropriate billing option.

More to read: