---

name: cost-optimization description: "Cloud cost optimization and FinOps practices. Use when analyzing cloud costs, implementing savings strategies, or optimizing resource usage."

Cloud Cost Optimization

FinOps practices for managing and optimizing cloud spending.

When to Use

• Analyzing and reducing cloud costs
• Implementing cost allocation and tagging
• Right-sizing resources
• Choosing commitment options
• Setting up cost alerts and budgets

Cost Optimization Framework

The Three Pillars

Tagging Strategy

Required Tags

Copylocals {
  required_tags = {
    Environment = var.environment
    Project     = var.project
    Owner       = var.owner
    CostCenter  = var.cost_center
    ManagedBy   = "terraform"
    Application = var.application
  }
}

resource "aws_instance" "example" {
  # ...
  tags = merge(local.required_tags, {
    Name = "${var.project}-web"
    Role = "webserver"
  })
}

Tag Policy (AWS)

Copy{
  "tags": {
    "Environment": {
      "tag_key": { "@@assign": "Environment" },
      "tag_value": {
        "@@assign": ["production", "staging", "development"]
      },
      "enforced_for": {
        "@@assign": ["ec2:instance", "rds:db", "s3:bucket"]
      }
    },
    "CostCenter": {
      "tag_key": { "@@assign": "CostCenter" },
      "enforced_for": {
        "@@assign": ["*"]
      }
    }
  }
}

Right-Sizing

Identify Over-Provisioned Resources

Copy-- AWS Cost Explorer query
SELECT
  line_item_resource_id,
  product_instance_type,
  AVG(line_item_usage_amount) as avg_usage,
  MAX(line_item_usage_amount) as max_usage
FROM cost_and_usage_report
WHERE line_item_product_code = 'AmazonEC2'
GROUP BY 1, 2
HAVING avg_usage < max_usage * 0.3  -- Under 30% utilized

Right-Sizing Recommendations

Terraform Right-Sizing

Copyvariable "instance_sizes" {
  type = map(string)
  default = {
    development = "t3.small"
    staging     = "t3.medium"
    production  = "m5.large"
  }
}

resource "aws_instance" "app" {
  instance_type = var.instance_sizes[var.environment]
}

Commitment Discounts

Comparison

AWS Savings Plans

Copyresource "aws_ce_savings_plan_purchase_recommendation" "compute" {
  lookback_period_in_days = "SIXTY_DAYS"
  payment_option          = "NO_UPFRONT"
  savings_plan_type       = "COMPUTE_SP"
  term_in_years           = "ONE_YEAR"
}

GCP Committed Use

Copyresource "google_compute_resource_policy" "commitment" {
  name   = "commitment-policy"
  region = var.region

  instance_schedule_policy {
    vm_start_schedule {
      schedule = "0 9 * * MON-FRI"
    }
    vm_stop_schedule {
      schedule = "0 18 * * MON-FRI"
    }
  }
}

Spot/Preemptible Instances

AWS Spot Instances

Copyresource "aws_spot_fleet_request" "workers" {
  iam_fleet_role  = aws_iam_role.spot_fleet.arn
  target_capacity = 10

  launch_specification {
    instance_type     = "m5.large"
    ami               = data.aws_ami.amazon_linux.id
    spot_price        = "0.05"

    tags = {
      Name = "spot-worker"
    }
  }

  launch_specification {
    instance_type     = "m5.xlarge"
    ami               = data.aws_ami.amazon_linux.id
    spot_price        = "0.10"
  }

  # Diversify across instance types
  allocation_strategy = "diversified"
}

GCP Preemptible VMs

Copyresource "google_compute_instance" "worker" {
  name         = "worker"
  machine_type = "e2-standard-4"

  scheduling {
    preemptible         = true
    automatic_restart   = false
    on_host_maintenance = "TERMINATE"
  }
}

Kubernetes Spot Nodes

Copy# EKS Node Group with Spot
apiVersion: eksctl.io/v1alpha5
kind: ClusterConfig
metadata:
  name: my-cluster
  region: us-east-1

managedNodeGroups:
  - name: spot-workers
    instanceTypes: ["m5.large", "m5.xlarge", "m4.large"]
    spot: true
    minSize: 2
    maxSize: 20
    labels:
      lifecycle: spot
    taints:
      - key: lifecycle
        value: spot
        effect: NoSchedule

Storage Optimization

S3 Lifecycle Policies

Copyresource "aws_s3_bucket_lifecycle_configuration" "data" {
  bucket = aws_s3_bucket.data.id

  rule {
    id     = "archive"
    status = "Enabled"

    transition {
      days          = 30
      storage_class = "STANDARD_IA"  # 45% cheaper
    }

    transition {
      days          = 90
      storage_class = "GLACIER"  # 68% cheaper
    }

    transition {
      days          = 180
      storage_class = "DEEP_ARCHIVE"  # 95% cheaper
    }

    expiration {
      days = 365
    }
  }
}

EBS Optimization

Copy# Use gp3 instead of gp2 (20% cheaper, better performance)
resource "aws_ebs_volume" "data" {
  availability_zone = var.az
  size              = 100
  type              = "gp3"
  iops              = 3000   # Baseline included
  throughput        = 125    # Baseline included
}

Budget Alerts

AWS Budget

Copyresource "aws_budgets_budget" "monthly" {
  name         = "${var.project}-monthly"
  budget_type  = "COST"
  limit_amount = "1000"
  limit_unit   = "USD"
  time_unit    = "MONTHLY"

  cost_filter {
    name   = "TagKeyValue"
    values = ["user:Project$${var.project}"]
  }

  notification {
    comparison_operator        = "GREATER_THAN"
    threshold                  = 80
    threshold_type             = "PERCENTAGE"
    notification_type          = "FORECASTED"
    subscriber_email_addresses = [var.alert_email]
  }

  notification {
    comparison_operator        = "GREATER_THAN"
    threshold                  = 100
    threshold_type             = "PERCENTAGE"
    notification_type          = "ACTUAL"
    subscriber_email_addresses = [var.alert_email]
  }
}

GCP Budget

Copyresource "google_billing_budget" "project" {
  billing_account = var.billing_account
  display_name    = "${var.project} Budget"

  budget_filter {
    projects = ["projects/${var.project}"]
  }

  amount {
    specified_amount {
      currency_code = "USD"
      units         = "1000"
    }
  }

  threshold_rules {
    threshold_percent = 0.5
  }

  threshold_rules {
    threshold_percent = 0.8
  }

  threshold_rules {
    threshold_percent = 1.0
    spend_basis       = "FORECASTED_SPEND"
  }

  all_updates_rule {
    pubsub_topic = google_pubsub_topic.budget.id
  }
}

Cost Analysis Queries

AWS Athena (Cost and Usage Report)

Copy-- Daily cost by service
SELECT
  DATE(line_item_usage_start_date) as date,
  line_item_product_code as service,
  SUM(line_item_unblended_cost) as cost
FROM cost_report
WHERE MONTH(line_item_usage_start_date) = MONTH(CURRENT_DATE)
GROUP BY 1, 2
ORDER BY 1, 3 DESC;

-- Cost by tag
SELECT
  resource_tags_user_project as project,
  SUM(line_item_unblended_cost) as cost
FROM cost_report
WHERE MONTH(line_item_usage_start_date) = MONTH(CURRENT_DATE)
GROUP BY 1
ORDER BY 2 DESC;

Quick Wins

Checklist

• Consistent tagging implemented
• Cost allocation reports enabled
• Budgets and alerts configured
• Unused resources identified
• Right-sizing analyzed
• Commitment options evaluated
• Storage tiering configured
• Dev environments scheduled

Integration

Works with:

• /aws, /gcp, /azure - Cloud cost analysis
• /terraform - Cost-aware infrastructure
• /devops - Cost in CI/CD