Reserved Instances

Reserved Instances (RI) let you reserve EC2, RDS, ElastiCache, Redshift, or other capacity for 1 or 3 years in exchange for a discount vs On-Demand pricing. They’re the older sibling to Savings Plans — more restrictive in some ways, but with capacity reservation options that SPs don’t offer.

RI vs On-Demand

Factor	On-Demand	Reserved Instance
Price	Full rate	Up to 72% discount
Commitment	None	1 or 3 years
Capacity	Not reserved	Reserved (zonal RI)
Billing	Per second (Linux)	Per second (Linux, no upfront)

RI Types

Standard RI

The original RI type. Reserved for a specific instance configuration:

• Instance family (e.g., m6i, c6i)
• Instance size (e.g., large, xlarge) — with size flexibility within the AZ
• Region or specific AZ
• Tenancy: Default or Dedicated

Zonal RI: Reserves capacity in a specific AZ. Higher discount but the reservation is stranded if the AZ has issues. Use for predictable baseline workloads that need the capacity guarantee.

Regional RI: No capacity reservation — just a pricing discount that applies anywhere in the region. Lower discount than zonal but no stranded capacity risk. Good when you want the discount but need availability across AZs.

Convertible RI

Can be exchanged for different instance types, families, or operating systems within the same instance family group. Lower discount ceiling (~60%) but maximum flexibility.

Use Convertible when:

• You might switch from Intel to AMD or Graviton
• You might resize instances as needs change
• You want RI-level discount but aren’t certain of exact requirements

Payment Options

Option	Upfront	Effective Discount
No Upfront	$0	~40-60%
Partial Upfront	~50%	~60-70%
All Upfront	100%	up to 72%

All Upfront with 3-year term gives the maximum discount. Partial/No Upfront with 1-year is the minimum commitment option.

Instance Size Flexibility

Zonal Standard RI: Size flexibility within the same instance family, within the same AZ. Buy 10 x m6i.large in us-east-1a, and those RI units automatically apply to any m6i instance size in us-east-1a.

1 RI unit = 1 x m6i.large (2 vCPU, 8GB)

Consuming instance: m6i.xlarge (4 vCPU, 16GB)
RI units consumed: 2 (each xlarge = 2 x large)

If you have 10 RIs:
- 10 x large = 10 consumed (all covered)
- 5 x xlarge = 10 consumed (5 xlarge use all 10 RIs)
- 15 x large = 10 consumed (5 uncovered, billed On-Demand)

Regional RI: No size flexibility — each RI unit covers exactly what you bought.

Convertible RI: Size flexibility via instance family exchanges. Can exchange a large for an xlarge of a different family, as long as the OS and tenancy match.

Services Covered by RI

RI pricing is available for:

• EC2 (all instance families)
• RDS (MySQL, PostgreSQL, MariaDB, Oracle, SQL Server)
• ElastiCache (Redis, Memcached)
• Redshift
• OpenSearch (formerly Elasticsearch)
• SageMaker (not via RI — use SageMaker SP instead)

Note: Lambda, Fargate, and ECS do NOT support RI pricing — use Savings Plans for serverless.

RI Marketplace

Unused RI capacity can be sold on the RI Marketplace. Requirements:

• At least 30 days remaining on the term
• No more than 3 years total remaining
• Account must be in good standing

This is useful when you migrate workloads mid-term and want to recover some of the upfront cost.

Coverage vs Utilization

These two metrics measure different things:

Coverage: What % of your instances are covered by RI/SP. Target: 80-90%+ for production baseline.

Coverage = (Instance hours covered by RI/SP) / (Total instance hours) × 100

Utilization: Are you fully using the instances you reserved?

Utilization = (Hours of RI capacity actually used) / (Hours of RI capacity purchased) × 100

An RI with 50% utilization means half the reserved capacity sat idle. You paid for it but didn’t use it. This isn’t necessarily bad — it’s often better than running On-Demand and risking capacity unavailability — but it’s a cost efficiency signal.

When to Use RIs

• Baseline always-on workloads in RDS, ElastiCache, Redshift
• Predictable capacity needs in a specific AZ (zonal RI)
• Migrated databases where you know the exact instance size
• Multi-AZ with known read replica count — buy the primary RI, let replicas be On-Demand or covered by regional RI

Common Mistakes

1. Buying on peak, not baseline. If you buy 100 RIs for a workload that peaks at 100 but averages 40, you’re paying for 60 unused RIs most of the time.

2. Ignoring regional vs zonal. Zonal RIs give better discounts but strand if the AZ has issues. Always know which you’re buying.

3. Buying RI for development workloads. Dev/test environments that run 8-5 Monday-Friday are better served by Savings Plans + auto stoppage schedules, not RIs.

4. Buying 3-year for fast-changing workloads. If you’re mid-migration to Graviton or constantly resizing, a 3-year RI locks you into a decision that might not fit in 18 months.

References

• Homepage: https://aws.amazon.com/ec2/pricing/reserved-instances/
• Documentation: https://docs.aws.amazon.com/AWSEC2/latest/UserGuide/ec2-reserved-instances.html
• Pricing: https://aws.amazon.com/ec2/pricing/reserved-instances/pricing/

Pricing Examples

Scenario 1: A production RDS PostgreSQL instance (db.r6g.large, Multi-AZ) running 24/7. 3-year All Upfront RI: ~$1,350/yearvsOn-Demand$2,400/year. Savings: ~$1,050/year (44%). Add the secondary AZ (same RI covers it via regional RI): no additional cost.

Scenario 2: A data processing cluster of 8 c6i.2xlarge instances running batch jobs 10 hours/day, 5 days/week. 1-year Partial Upfront RI: $3,800upfront+$120/month vs On-Demand ~$650/month.Annual:$4,200 vs $7,800.Savings:$3,600/year.

Nuggets & Gotchas

• Zonal RIs can strand if the AZ fails: You bought capacity in us-east-1a and us-east-1a has an outage. Your RI is stranded — you can’t move it to another AZ. Use regional RIs if AZ resilience matters more than the discount differential.
• RI size flexibility only works within the same AZ: A zonal m6i.large RI covers any m6i size in the same AZ (large=1 unit, xlarge=2 units, etc.) but not across AZs. Regional RIs have no size flexibility.
• Windows RIs have separate license billing: RI pricing for Windows is the base compute rate. If you need SQL Server licensing through AWS, that’s a separate charge on top of the RI price.
• RI coverage doesn’t mean RI utilization: You can have 100% coverage (all instances covered by RI) but only 60% utilization (your RIs are 40% idle because you over-bought). Coverage is about financial coverage, not efficiency.
• Selling on RI Marketplace requires 30 days minimum remaining: If you migrate a workload 60 days into a 3-year RI, you can sell the remaining ~1,000 days on the RI Marketplace. But not if less than 30 days remain.