# How Reserved Instance discounts are applied Reserved Instances are not physical instances, but rather a billing discount that is applied to the running On-Demand Instances in your account. The On-Demand Instances must match certain specifications of the Reserved Instances in order to benefit from the billing discount. If you purchase a Reserved Instance and you already have a running On-Demand Instance that matches the specifications of the Reserved Instance, the billing discount is applied immediately and automatically. You do not have to restart your instances. If you do not have an eligible running On-Demand Instance, launch an On-Demand Instance with the same specifications as your Reserved Instance. For more information, see [Use your Reserved Instances](using-reserved-instances.md). The offering class (Standard or Convertible) of the Reserved Instance does not affect how the billing discount is applied. **Topics** + [ ## How zonal Reserved Instances are applied ](#apply-zonal-ri) + [ ## How regional Reserved Instances are applied ](#apply-regional-ri) + [ ## Instance size flexibility ](#ri-instance-size-flexibility) + [ ## Examples of applying Reserved Instances ](#ri-usage-examples) ## How zonal Reserved Instances are applied A Reserved Instance that is purchased to reserve capacity in a specific Availability Zone is called a zonal Reserved Instance. + The Reserved Instance discount applies to matching instance usage in that Availability Zone. + The attributes (tenancy, platform, Availability Zone, instance type, and instance size) of the running instances must match that of the Reserved Instances. For example, if you purchase two `c4.xlarge` default tenancy Linux/Unix Standard Reserved Instances for Availability Zone us-east-1a, then up to two `c4.xlarge` default tenancy Linux/Unix instances running in the Availability Zone us-east-1a can benefit from the Reserved Instance discount. ## How regional Reserved Instances are applied A Reserved Instance that is purchased for a Region is called a regional Reserved Instance, and provides Availability Zone and instance size flexibility. + The Reserved Instance discount applies to instance usage in any Availability Zone in that Region. + The Reserved Instance discount applies to instance usage within the instance family, regardless of size—this is known as [instance size flexibility](#ri-instance-size-flexibility). ## Instance size flexibility With instance size flexibility, the Reserved Instance discount applies to instance usage for instances that have the same [ family](https://docs.aws.amazon.com/ec2/latest/instancetypes/instance-type-names.html). The Reserved Instance is applied from the smallest to the largest instance size within the instance family based on the normalization factor. For an example of how the Reserved Instance discount is applied, see [Scenario 2: Reserved Instances in a single account using the normalization factor](#ri-usage-ex2). ### Limitations + **Supported: **Instance size flexibility is only supported for Regional Reserved Instances. + **Not supported:** Instance size flexibility is *not supported* for the following Reserved Instances: + Reserved Instances that are purchased for a specific Availability Zone (zonal Reserved Instances) + Reserved Instances for G4ad, G4dn, G5, G5g, G6, G6e, G6f, Gr6, Gr6f, hpc7a, P5, Inf1, Inf2, u7i-6tb, and u7i-8tb instances + Reserved Instances for Windows Server, Windows Server with SQL Standard, Windows Server with SQL Server Enterprise, Windows Server with SQL Server Web, RHEL, and SUSE Linux Enterprise Server + Reserved Instances with dedicated tenancy ### Instance size flexibility determined by normalization factor Instance size flexibility is determined by the normalization factor of the instance size. The discount applies either fully or partially to running instances of the same instance family, depending on the instance size of the reservation, in any Availability Zone in the Region. The only attributes that must be matched are the instance family, tenancy, and platform. The following table lists the different sizes within an instance family, and the corresponding normalization factor. This scale is used to apply the discounted rate of Reserved Instances to the normalized usage of the instance family. | Instance size | Normalization factor | | --- | --- | | nano | 0.25 | | micro | 0.5 | | small | 1 | | medium | 2 | | large | 4 | | xlarge | 8 | | 2xlarge | 16 | | 3xlarge | 24 | | 4xlarge | 32 | | 6xlarge | 48 | | 8xlarge | 64 | | 9xlarge | 72 | | 10xlarge | 80 | | 12xlarge | 96 | | 16xlarge | 128 | | 18xlarge | 144 | | 24xlarge | 192 | | 32xlarge | 256 | | 48xlarge | 384 | | 56xlarge | 448 | | 112xlarge | 896 | For example, a `t2.medium` instance has a normalization factor of 2. If you purchase a `t2.medium` default tenancy Amazon Linux/Unix Reserved Instance in the US East (N. Virginia) and you have two running `t2.small` instances in your account in that Region, the billing benefit is applied in full to both instances. ![\[Applying a Regional Reserved Instance.\]](http://docs.aws.amazon.com/AWSEC2/latest/UserGuide/images/ri-instance-flex-full.png) Or, if you have one `t2.large` instance running in your account in the US East (N. Virginia) Region, the billing benefit is applied to 50% of the usage of the instance. ![\[Applying a Regional Reserved Instance.\]](http://docs.aws.amazon.com/AWSEC2/latest/UserGuide/images/ri-instance-flex-partial.png) The normalization factor is also applied when modifying Reserved Instances. For more information, see [Modify Reserved Instances](ri-modifying.md). #### Normalization factor for bare metal instances Instance size flexibility also applies to bare metal instances within the instance family. If you have regional Amazon Linux/Unix Reserved Instances with shared tenancy on bare metal instances, you can benefit from the Reserved Instance savings within the same instance family. The opposite is also true: if you have regional Amazon Linux/Unix Reserved Instances with shared tenancy on instances in the same family as a bare metal instance, you can benefit from the Reserved Instance savings on the bare metal instance. The `metal` instance size does not have a single normalization factor. A bare metal instance has the same normalization factor as the equivalent virtualized instance size within the same instance family. For example, an `i3.metal` instance has the same normalization factor as an `i3.16xlarge` instance. | Instance size | Normalization factor | | --- | --- | | a1.metal | 32 | | m5zn.metal \$1 x2iezn.metal z1d.metal | 96 | | c6g.metal \$1 c6gd.metal \$1 i3.metal \$1 m6g.metal \$1 m6gd.metal \$1 r6g.metal \$1 r6gd.metal \$1 x2gd.metal | 128 | | c5n.metal | 144 | | c5.metal \$1 c5d.metal \$1 i3en.metal \$1 m5.metal \$1 m5d.metal \$1 m5dn.metal \$1 m5n.metal \$1 r5.metal \$1 r5b.metal \$1 r5d.metal \$1 r5dn.metal \$1 r5n.metal | 192 | | c6i.metal \$1 c6id.metal \$1 m6i.metal \$1 m6id.metal \$1 r6d.metal \$1 r6id.metal | 256 | | u-18tb1.metal \$1 u-24tb1.metal | 448 | | u-6tb1.metal \$1 u-9tb1.metal \$1 u-12tb1.metal | 896 | For example, an `i3.metal` instance has a normalization factor of 128. If you purchase an `i3.metal` default tenancy Amazon Linux/Unix Reserved Instance in the US East (N. Virginia), the billing benefit can apply as follows: + If you have one running `i3.16xlarge` in your account in that Region, the billing benefit is applied in full to the `i3.16xlarge` instance (`i3.16xlarge` normalization factor = 128). + Or, if you have two running `i3.8xlarge` instances in your account in that Region, the billing benefit is applied in full to both `i3.8xlarge` instances (`i3.8xlarge` normalization factor = 64). + Or, if you have four running `i3.4xlarge` instances in your account in that Region, the billing benefit is applied in full to all four `i3.4xlarge` instances (`i3.4xlarge` normalization factor = 32). The opposite is also true. For example, if you purchase two `i3.8xlarge` default tenancy Amazon Linux/Unix Reserved Instances in the US East (N. Virginia), and you have one running `i3.metal` instance in that Region, the billing benefit is applied in full to the `i3.metal` instance. ## Examples of applying Reserved Instances **Topics** + [ ### Scenario 1: Reserved Instances in a single account ](#ri-usage-ex1) + [ ### Scenario 2: Reserved Instances in a single account using the normalization factor ](#ri-usage-ex2) + [ ### Scenario 3: Regional Reserved Instances in linked accounts ](#ri-usage-ex3) + [ ### Scenario 4: Zonal Reserved Instances in a linked account ](#ri-usage-ex4) ### Scenario 1: Reserved Instances in a single account You are running the following On-Demand Instances in account A: + 4 x `m3.large` Linux, default tenancy instances in Availability Zone us-east-1a + 2 x `m4.xlarge` Amazon Linux, default tenancy instances in Availability Zone us-east-1b + 1 x `c4.xlarge` Amazon Linux, default tenancy instances in Availability Zone us-east-1c You purchase the following Reserved Instances in account A: + 4 x `m3.large` Linux, default tenancy Reserved Instances in Availability Zone us-east-1a (capacity is reserved) + 4 x `m4.large` Amazon Linux, default tenancy Reserved Instances in Region us-east-1 + 1 x `c4.large` Amazon Linux, default tenancy Reserved Instances in Region us-east-1 The Reserved Instance benefits are applied in the following way: + The discount and capacity reservation of the four `m3.large` zonal Reserved Instances is used by the four `m3.large` instances because the attributes (instance size, Region, platform, tenancy) between them match. + The `m4.large` regional Reserved Instances provide Availability Zone and instance size flexibility, because they are regional Amazon Linux Reserved Instances with default tenancy. An `m4.large` is equivalent to 4 normalized units/hour. You've purchased four `m4.large` regional Reserved Instances, and in total, they are equal to 16 normalized units/hour (4x4). Account A has two `m4.xlarge` instances running, which is equivalent to 16 normalized units/hour (2x8). In this case, the four `m4.large` regional Reserved Instances provide the full billing benefit to the usage of the two `m4.xlarge` instances. + The `c4.large` regional Reserved Instance in us-east-1 provides Availability Zone and instance size flexibility, because it is a regional Amazon Linux Reserved Instance with default tenancy, and applies to the `c4.xlarge` instance. A `c4.large` instance is equivalent to 4 normalized units/hour and a `c4.xlarge` is equivalent to 8 normalized units/hour. In this case, the `c4.large` regional Reserved Instance provides partial benefit to `c4.xlarge` usage. This is because the `c4.large` Reserved Instance is equivalent to 4 normalized units/hour of usage, but the `c4.xlarge` instance requires 8 normalized units/hour. Therefore, the `c4.large` Reserved Instance billing discount applies to 50% of `c4.xlarge` usage. The remaining `c4.xlarge` usage is charged at the On-Demand rate. ### Scenario 2: Reserved Instances in a single account using the normalization factor You are running the following On-Demand Instances in account A: + 2 x `m3.xlarge` Amazon Linux, default tenancy instances in Availability Zone us-east-1a + 2 x `m3.large` Amazon Linux, default tenancy instances in Availability Zone us-east-1b You purchase the following Reserved Instance in account A: + 1 x `m3.2xlarge` Amazon Linux, default tenancy Reserved Instance in Region us-east-1 The Reserved Instance benefits are applied in the following way: + The `m3.2xlarge` regional Reserved Instance in us-east-1 provides Availability Zone and instance size flexibility, because it is a regional Amazon Linux Reserved Instance with default tenancy. It applies first to the `m3.large` instances and then to the `m3.xlarge` instances, because it applies from the smallest to the largest instance size within the instance family based on the normalization factor. An `m3.large` instance is equivalent to 4 normalized units/hour. An `m3.xlarge` instance is equivalent to 8 normalized units/hour. An `m3.2xlarge` instance is equivalent to 16 normalized units/hour. The benefit is applied as follows: The `m3.2xlarge` regional Reserved Instance provides full benefit to 2 x `m3.large` usage, because together these instances account for 8 normalized units/hour. This leaves 8 normalized units/hour to apply to the `m3.xlarge` instances. With the remaining 8 normalized units/hour, the `m3.2xlarge` regional Reserved Instance provides full benefit to 1 x `m3.xlarge` usage, because each `m3.xlarge` instance is equivalent to 8 normalized units/hour. The remaining `m3.xlarge` usage is charged at the On-Demand rate. ### Scenario 3: Regional Reserved Instances in linked accounts Reserved Instances are first applied to usage within the purchasing account, followed by qualifying usage in any other account in the organization. For more information, see [Reserved Instances and consolidated billing](concepts-reserved-instances-application.md#concepts-reserved-instances-billing). For regional Reserved Instances that offer instance size flexibility, the benefit is applied from the smallest to the largest instance size within the instance family. You're running the following On-Demand Instances in account A (the purchasing account): + 2 x `m4.xlarge` Linux, default tenancy instances in Availability Zone us-east-1a + 1 x `m4.2xlarge` Linux, default tenancy instances in Availability Zone us-east-1b + 2 x `c4.xlarge` Linux, default tenancy instances in Availability Zone us-east-1a + 1 x `c4.2xlarge` Linux, default tenancy instances in Availability Zone us-east-1b Another customer is running the following On-Demand Instances in account B—a linked account: + 2 x `m4.xlarge` Linux, default tenancy instances in Availability Zone us-east-1a You purchase the following regional Reserved Instances in account A: + 4 x `m4.xlarge` Linux, default tenancy Reserved Instances in Region us-east-1 + 2 x `c4.xlarge` Linux, default tenancy Reserved Instances in Region us-east-1 The regional Reserved Instance benefits are applied in the following way: + The discount of the four `m4.xlarge` Reserved Instances is used by the two `m4.xlarge` instances and the single `m4.2xlarge` instance in account A (purchasing account). All three instances match the attributes (instance family, Region, platform, tenancy). The discount is applied to instances in the purchasing account (account A) first, even though account B (linked account) has two `m4.xlarge` that also match the Reserved Instances. There is no capacity reservation because the Reserved Instances are regional Reserved Instances. + The discount of the two `c4.xlarge` Reserved Instances applies to the two `c4.xlarge` instances, because they are a smaller instance size than the `c4.2xlarge` instance. There is no capacity reservation because the Reserved Instances are regional Reserved Instances. ### Scenario 4: Zonal Reserved Instances in a linked account In general, Reserved Instances that are owned by an account are applied first to usage in that account. However, if there are qualifying, unused Reserved Instances for a specific Availability Zone (zonal Reserved Instances) in other accounts in the organization, they are applied to the account before regional Reserved Instances owned by the account. This is done to ensure maximum Reserved Instance utilization and a lower bill. For billing purposes, all the accounts in the organization are treated as one account. The following example might help explain this. You're running the following On-Demand Instance in account A (the purchasing account): + 1 x `m4.xlarge` Linux, default tenancy instance in Availability Zone us-east-1a A customer is running the following On-Demand Instance in linked account B: + 1 x `m4.xlarge` Linux, default tenancy instance in Availability Zone us-east-1b You purchase the following regional Reserved Instances in account A: + 1 x `m4.xlarge` Linux, default tenancy Reserved Instance in Region us-east-1 A customer also purchases the following zonal Reserved Instances in linked account C: + 1 x `m4.xlarge` Linux, default tenancy Reserved Instances in Availability Zone us-east-1a The Reserved Instance benefits are applied in the following way: + The discount of the `m4.xlarge` zonal Reserved Instance owned by account C is applied to the `m4.xlarge` usage in account A. + The discount of the `m4.xlarge` regional Reserved Instance owned by account A is applied to the `m4.xlarge` usage in account B. + If the regional Reserved Instance owned by account A was first applied to the usage in account A, the zonal Reserved Instance owned by account C remains unused and usage in account B is charged at On-Demand rates. For more information, see [Understanding your reservations](https://docs.aws.amazon.com/cur/latest/userguide/understanding-ri.html) in the AWS Cost and Usage Report. **Note** Zonal Reserved Instances reserve capacity only for the owning account and cannot be shared with other AWS accounts. If you need to share capacity with other AWS accounts, use [Reserve compute capacity with EC2 On-Demand Capacity Reservations](ec2-capacity-reservations.md).