AWS Saving Plans Calculation Example by Amazon

Hi There

The $47.18 from scenario 1 is just an example. Its based on the discounted rate that you get when you purchase a savings plan. It works like this:

• You have an EC2 instance that costs $1/hour to run on-demand
• The discounted rate for this instance is $.90/hour when you purchase a savings plan for 1 year. This is the discount you get for committing to 1 year of usage.
• You purchase a savings plan commitment of $.90/hour which will cover the entire cost of running that instance.
• If you spin up a second instance of the same type, you are billed $1.90/hour. ($.90/hour for the savings plan + $1/hour the on demand rate for the second instance)
• If you terminate both instances, you are still billed $.90/hour because you committed to that amount for the year.

Check out this youtube video for a good explanation of how savings plans work: https://www.youtube.com/watch?v=xjq-1CdvgQ8

HI Matt. I think I forgot to thank you. To add a little more information to the answer below is the Total Calculation

Let’s break down the calculation for the total cost of $47.13 in the example scenario:

r5.4xlarge Linux Instances:

• On-Demand rate: $1.00 per hour
• Savings Plans rate: $0.70 per hour (30% off On-Demand)
• You have 4 instances running for the full hour. Total cost with Savings Plans: $0.70 × 4 = $2.80

Fargate vCPUs:

• On-Demand rate: $0.04 per vCPU per hour
• Savings Plans rate: $0.03 per vCPU per hour (25% off On-Demand)
• You have 400 vCPUs in usage. Total cost with Savings Plans: $0.03 × 400 = $12.00

m5.24xlarge Windows Instance:

• On-Demand rate: $10.00 per hour
• Savings Plans rate: $8.20 per hour (18% off On-Demand)
• You have 1 instance running for the full hour. Total cost with Savings Plans: $8.20

AWS Lambda:

• Lambda duration (per GB/sec):
• On-Demand rate: $0.000015 per GB/sec
• Savings Plans rate: $0.00001275 per GB/sec (15% off On-Demand)
• You have 1,600 GB-seconds of usage. Total cost with Savings Plans: $0.00001275 × 1,600 = $20.40

Lambda requests (per 1M requests):

• On-Demand rate: $0.20 per 1M requests
• Savings Plans rate: $0.20 per 1M requests (0% off On-Demand)
• You have 1 million requests. Total cost with Savings Plans: $0.20

Overall Total Cost: Adding up all the individual costs: $2.80 (r5.4xlarge Linux) + $12.00 (Fargate vCPUs) + $8.20 (m5.24xlarge Windows) + $20.40 (Lambda duration) + $0.20 (Lambda requests) = $43.60

The total cost is less than your $50.00/hour commitment, so it covers your usage.

The remaining commitment not used: $50.00 - $43.60 = $6.40

Therefore, the total cost considering the commitment is $43.60 + $6.40 = $47.13.