What is an Amazon EC2 Reserved Instance?

Last updated: 2020-04-20

I plan to use a particular Amazon Elastic Compute Cloud (Amazon EC2) instance configuration for steady-state workflows over a long period of time. Should I purchase a matching Reserved Instance?

Resolution

An Amazon Reserved Instance (RI) is a billing discount that allows you to save on your Amazon EC2 usage costs. When you purchase a Reserved Instance, you can set attributes such as instance type, platform, tenancy, Region, or Availability Zone (optional). Any existing or new On-Demand Instances matching the selected attributes are charged at the discounted Reserved Instance price. Reserved Instances act as an automatic discount on new or existing On-Demand Instances in your account.

The Reserved Instance doesn't provide a discount until you launch an instance with the required specifications.

You receive discounts or capacity reservations depending on which RI you choose:

  • Regional Reserved Instances provide a pricing discount that helps you save money. Regional RIs apply a discount to On-Demand Instances you run in a particular Region.
  • Zonal Reserved Instances allow you to create a capacity reservation for an instance type within a specific Availability Zone. Zonal RIs also provide substantial discounts over On-Demand Pricing.

For more information on the differences between Zonal and Regional Reserved Instances, see Regional and zonal Reserved Instances (scope).

The size of the discount you receive depends on whether you are using a standard RI or convertible RI.

  • Standard RIs provide the largest discount for a specific instance type over a long-term contract.
  • Convertible RIs provide a smaller discount, but let you change the instance type during the contract.

For more information on Standard and Convertible Reserved Instances, see Types of Reserved Instances (offering classes).

Consider the following when deciding if Reserved Instances are right for you:

  • Reserved Instances have long contract terms (usually, one or three years). This means that you should only purchase reservations for an instance specification that you use over the long term.
  • Most Reserved Instances are billed as a lump sum each month for each hour in that month. You're billed for this amount whether you ran an instance that matched your reservation or not. Reserved Instances provide the maximum discount for instance types that you use often and for long periods of time.
  • You can't cancel a Reserved Instance. However, you can modify your Reserved Instance, subject to certain restrictions. For information about the available types of modifications, see Modifying Reserved Instances.
  • If you decide you don't need an EC2 Reserved Instance after you purchase it and you have access to a US bank account, you can sell the Reserved Instance on the EC2 Reserved Instance Marketplace. For more details, see Amazon EC2 Reserved Instance Marketplace.
  • If your account is in an organization's consolidated billing family, additional considerations might apply. For more information, see How is the pricing benefit of a Reserved Instance applied across an organization's consolidated bill?
  • Capacity reservations only apply to zonal Reserved Instances, not Regional Reserved Instances. If you are interested in the capacity reservation, but not the billing discount, then you might want to use On-Demand Capacity Reservations.
  • For short-term discounts on EC2 instances, consider placing a bid for a Spot Instance instead.

For more detailed information about and pricing for EC2 Reserved Instances, see Amazon EC2 Reserved Instances.

Example:

You have a t2.medium instance running as an On-Demand Instance. You purchase a Reserved Instance that matches the configuration of this particular t2.medium instance. At the time of purchase, the billing mode for the existing instance changes to the Reserved Instance discounted rate. The existing t2.medium instance doesn't need replacing or migrating to get the discount.

After the reservation expires, the instance is charged as an On-Demand Instance. You can repurchase the Reserved Instance to continue the discounted rate on your instance.


Did this article help you?

Anything we could improve?


Need more help?