# Underutilized EC2 instance | Cloud Efficiency Hub Canonical: https://www.pointfive.co/efficiency-hub/inefficiencies/underutilized-ec2-instance EC2 instances are often overprovisioned based on rough estimates, legacy patterns, or performance buffer assumptions. By: Taylor Houck Updated: 2026-09-28 [Cloud Efficiency Hub](https://www.pointfive.co/efficiency-hub) # Underutilized EC2 Instance The short version EC2 instances are often overprovisioned based on rough estimates, legacy patterns, or performance buffer assumptions. [Taylor Houck](https://www.linkedin.com/in/twhouck/) Cloud FinOps Specialist @ PointFive AWS service [AWS EC2](https://www.pointfive.co/efficiency-hub/cloud-services/aws-ec2) Category [Compute](https://www.pointfive.co/efficiency-hub/service-category/compute) Reference CER-0047 Type Overprovisioned Resource ## Explanation Why the waste happens and who it affects. If an instance consistently uses only a small fraction of its provisioned CPU or memory, it likely represents an opportunity for rightsizing. These inefficiencies persist unless usage is periodically reviewed and instance types are adjusted to align with actual workload requirements. ## Billing model The pricing dimensions that drive this cost. EC2 instances are billed based on: - Instance type and size - Larger or more specialized instances incur higher hourly or per-second costs - Uptime - Charged per second with a 60-second minimum for Linux, Windows, RHEL and Ubuntu Pro; SLES is billed per full hour - Storage and data transfer ## How to detect 5 checks to find it in your estate. - Review average CPU and memory utilization of running EC2 instances. - Determine whether actual usage justifies the selected instance type or size - Confirm whether performance buffers, licensing rules, or other constraints require overprovisioning - Check whether the workload could be better served with burstable instances (e.g., T family) or smaller sizes within the same family - Validate with application owners whether the instance can be safely resized ## How to fix How to remove the waste. Resize the EC2 instance to a smaller type that better matches observed usage. Consider using burstable instances for smaller workloads with spiky or inconsistent usage. Review Auto Scaling policies to allow dynamic adjustment when necessary. ## Documentation Vendor references for pricing and configuration. [AWS EC2 Pricing](https://aws.amazon.com/ec2/pricing/) ## Related inefficiencies [Browse the library](https://www.pointfive.co/efficiency-hub) - AWS EC2 CER-0014 ### [Underutilized Instances in EC2 Auto Scaling Group](https://www.pointfive.co/efficiency-hub/inefficiencies/underutilized-instances-in-ec2-auto-scaling-group) Oversized instances within Auto Scaling Groups lead to inflated baseline costs, even when scaling adjusts the number of instances dynamically. When workloads consistently use only a fraction of the available CPU, memory, or network... Compute - AWS EC2 CER-0327 ### [Spot Instance Overreliance Without Effective Cost-Per-Performance Analysis](https://www.pointfive.co/efficiency-hub/inefficiencies/spot-instance-overreliance-without-cost-per-performance-analysis) Organizations frequently pursue aggressive Spot Instance adoption based on headline discount percentages - up to 90% off On-Demand pricing - without evaluating the effective cost per unit of work completed. While Spot pricing can deliver... Compute - AWS EC2 CER-0324 ### [Excessive On-Demand Compute Spend Due to Low Savings Plan and Reserved Instance Coverage](https://www.pointfive.co/efficiency-hub/inefficiencies/excessive-on-demand-compute-spend-due-to-low-savings-plan-and-reserved-instance-coverage) AWS compute services charge the full published On-Demand rate when no commitment-based discount - such as a Savings Plan (SP) or Reserved Instance (RI) - is in effect. On-Demand pricing provides maximum flexibility, but it is also the most... Compute --- Source: the public page above. Product screenshots and illustrative interfaces are examples, not live customer data.