Cost Optimization

Cost Explorer and Cost Analysis

Cost Explorer

# Get current month costs
aws ce get-cost-and-usage \
  --time-period Start=2024-01-01,End=2024-01-31 \
  --granularity MONTHLY \
  --metrics UnblendedCost

# Group by service
aws ce get-cost-and-usage \
  --time-period Start=2024-01-01,End=2024-01-31 \
  --granularity MONTHLY \
  --metrics UnblendedCost \
  --group-by Type=DIMENSION,Key=SERVICE

# Filter by specific service
aws ce get-cost-and-usage \
  --time-period Start=2024-01-01,End=2024-01-31 \
  --granularity MONTHLY \
  --metrics UnblendedCost \
  --filter '{"Dimensions":{"Key":"SERVICE","Values":["Amazon Elastic Compute Cloud - Compute"]}}'

# Group by tag
aws ce get-cost-and-usage \
  --time-period Start=2024-01-01,End=2024-01-31 \
  --granularity MONTHLY \
  --metrics UnblendedCost \
  --group-by Type=TAG,Key=Environment

Cost and Usage Report

# Create Cost and Usage Report
aws cur put-report-definition \
  --report-definition '{
    "ReportName": "my-cost-report",
    "TimeUnit": "DAILY",
    "Format": "textORcsv",
    "Compression": "ZIP",
    "S3BucketName": "my-cost-reports",
    "S3Prefix": "reports",
    "S3Region": "us-east-1",
    "AdditionalArtifacts": ["REDSHIFT", "QUICKSIGHT"],
    "AdditionalSchemaElements": ["RESOURCES"]
  }'

Resource Tagging Strategy

Tagging Best Practices

# Tag all resources
aws ec2 create-tags \
  --resources i-xxx \
  --tags \
    Key=Environment,Value=Production \
    Key=Project,Value=MyApp \
    Key=Team,Value=Engineering \
    Key=CostCenter,Value=12345

# List resources by tag
aws ec2 describe-instances \
  --filters "Name=tag:Environment,Values=Production" \
  --query 'Reservations[*].Instances[*].[InstanceId,Tags[?Key==`Name`].Value|[0]]'

Required Tags

Tag Policies (Organizations)

# Create tag policy
aws organizations create-policy \
  --content '{
    "Version": "2012-10-17",
    "Statement": [{
      "Sid": "RequireEnvironmentTag",
      "Effect": "Deny",
      "Action": "*",
      "Resource": "*",
      "Condition": {
        "StringNotEquals": {
          "aws:RequestTag/Environment": ["prod", "staging", "dev"]
        }
      }
    }]
  }' \
  --type TAG_POLICY \
  --name "Require Environment Tag"

Rightsizing and Optimization

AWS Compute Optimizer

# Enable Compute Optimizer
aws compute-optimizer update-enrollment-status --status Active

# Get EC2 recommendations
aws compute-optimizer get-ec2-instance-recommendations

# Get Lambda recommendations
aws compute-optimizer get-lambda-function-recommendations

# Get EBS volume recommendations
aws compute-optimizer get-ebs-volume-recommendations

EC2 Rightsizing

# Find underutilized instances
aws ce get-cost-and-usage \
  --time-period Start=2024-01-01,End=2024-01-31 \
  --granularity MONTHLY \
  --metrics UnblendedCost \
  --filter '{"Dimensions":{"Key":"SERVICE","Values":["Amazon Elastic Compute Cloud - Compute"]}}' \
  --group-by Type=TAG,Key=InstanceType

# Stop unused instances
aws ec2 describe-instances \
  --filters "Name=instance-state-name,Values=running" \
  --query 'Reservations[*].Instances[*].[InstanceId,InstanceType,CpuOptions,MemoryGiBOfMemory]'

Savings Plans

# Get Savings Plans recommendations
aws ce get-savings-plans-recommendations \
  --account-id 123456789012 \
  --term-in-years ONE_YEAR \
  --lookback-period-in-days SIXTY_DAYS

# Purchase Savings Plan
aws savingsplans purchase-savings-plan \
  --savings-plan-offering-id xxx \
  --purchase-commitment-amount 10.0 \
  --client-token $(uuidgen)

# Describe your Savings Plans
aws savingsplans describe-savings-plans

Budgets and Alerts

Create Budget

# Create a cost budget
aws budgets create-budget \
  --account-id 123456789012 \
  --budget '{
    "BudgetName": "Monthly-100",
    "BudgetLimit": {
      "Amount": "100",
      "Unit": "USD"
    },
    "TimeUnit": "MONTHLY",
    "BudgetType": "COST",
    "CostFilters": {
      "TagKeyValue": ["user:Environment$Production"]
    }
  }' \
  --notifications-with-subscribers '[{
    "Notification": {
      "NotificationType": "ACTUAL",
      "ComparisonOperator": "GREATER_THAN",
      "Threshold": 80,
      "ThresholdType": "PERCENTAGE"
    },
    "Subscribers": [{
      "SubscriptionType": "EMAIL",
      "Address": "admin@example.com"
    }]
  }]

Budget Types

Budget Notifications

# Add SNS notification
aws budgets create-budget \
  --account-id 123456789012 \
  --budget '{...}' \
  --notifications-with-subscribers '[{
    "Notification": {
      "NotificationType": "FORECASTED",
      "ComparisonOperator": "GREATER_THAN",
      "Threshold": 90
    },
    "Subscribers": [{
      "SubscriptionType": "SNS",
      "Address": "arn:aws:sns:us-east-1:xxx:cost-alerts"
    }]
  }'

Cost Optimization Checklist

Quick Wins

1. Terminate unused resources (old EBS volumes, unused ENIs)
2. Right-size instances based on CloudWatch metrics
3. Use Spot Instances for fault-tolerant workloads
4. Purchase Reserved Instances for steady-state workloads
5. Enable S3 Intelligent-Tiering for unpredictable access
6. Delete unattached Elastic IPs
7. Use gp3 instead of gp2 EBS volumes

Long-Term Strategy

┌─────────────────────────────────────────────────────────────┐
│                Cost Optimization Framework                   │
├─────────────────────────────────────────────────────────────┤
│                                                             │
│  1. Measure: Cost Explorer, CUR, Tagging                   │
│  2. Analyze: Identify waste, rightsizing opportunities     │
│  3. Optimize: RI, Savings Plans, Spot, Right-sizing        │
│  4. Monitor: Budgets, Alarms, Dashboards                   │
│  5. Automate: Lambda cleanup, Auto Scaling                 │
│                                                             │
└─────────────────────────────────────────────────────────────┘

Cost by Service

# Get cost breakdown by service
aws ce get-cost-and-usage \
  --time-period Start=2024-01-01,End=2024-01-31 \
  --granularity MONTHLY \
  --metrics UnblendedCost \
  --group-by Type=DIMENSION,Key=SERVICE \
  --sort-by Key=UnblendedCost,SortOrder=DESCENDING

Cost Optimization Automation

import boto3
import datetime

# Stop non-production instances outside business hours
ec2 = boto3.client('ec2')

def lambda_handler(event, context):
    hour = datetime.datetime.now().hour
    
    if hour < 8 or hour > 20:  # Before 8am or after 8pm
        instances = ec2.describe_instances(
            Filters=[{'Name': 'tag:Environment', 'Values': ['dev']}]
        )
        
        instance_ids = []
        for r in instances['Reservations']:
            for i in r['Instances']:
                if i['State']['Name'] == 'running':
                    instance_ids.append(i['InstanceId'])
        
        if instance_ids:
            ec2.stop_instances(InstanceIds=instance_ids)
            print(f'Stopped {len(instance_ids)} instances')