What is a good commitment coverage?

There's no universal target. Most teams cover the usage they're confident will run for the whole term and leave the rest on demand, so sensible coverage for spiky workloads is well below 100%. Raise coverage only while commitment utilization stays high.

What is the difference between commitment coverage and commitment utilization?

Coverage looks at your usage: how much of it a commitment paid for. Utilization looks at your commitments: how much of what you bought got used. Buying more raises coverage and can lower utilization; buying less does the opposite.

Is coverage measured in hours or in dollars?

Both exist. AWS reports Reserved Instance coverage in hours or normalized units and Savings Plans coverage in spend, and Google Cloud's CUD analysis reports the share of eligible spend. Dollars at on-demand prices are the only measure that compares across commitment types and clouds.

Commitments & rates

Commitment coverage

Commitment coverage is the share of commitment-eligible usage that a Reserved Instance, Savings Plan, Azure reservation or Google Cloud committed use discount paid for, measured at on-demand prices. The rest was billed at full on-demand rates, so low coverage on steady usage is money left on the table.

In plain English

Think of a monthly metro pass. Coverage is the share of your trips the pass paid for; every other trip, you bought a single ticket at full fare. Covering your daily commute makes sense. Buying a bigger pass for trips you might take doesn't.

Formula and worked example

Commitment coverage = covered usage ÷ eligible usage

Eligible usage: = all usage a commitment could apply to, priced at on-demand rates
Covered usage: = the part of eligible usage a commitment paid for, priced at on-demand rates

Worked example. Northwind Labs, the same month as the effective savings rate example: $100,000 of Savings Plan-eligible compute at on-demand prices, part of it covered by a Savings Plan.
Eligible usage at on-demand prices	$100,000
Covered by the Savings Plan, at on-demand prices	$76,000
Not covered, billed at on-demand rates	$24,000
Commitment coverage	76%

$24,000 of usage paid full price. Whether to cover more of it depends on how steady that usage is: commitment that outgrows real usage turns into unused commitment and lowers the effective savings rate.

Why commitment coverage matters

Coverage tells you how much of your commitment-eligible usage still pays on-demand prices. On steady workloads, that is the clearest sign of savings left on the table, which makes coverage the first number to check before buying more Reserved Instances, Savings Plans or CUDs.

It is also the easiest number to push too far. Coverage counts the usage a commitment touched, not whether buying it was a good idea. Read it next to commitment utilization, and judge the result by the effective savings rate.

Common mistakes

Aiming for 100%. Usage that rises and falls shouldn't be fully covered: a commitment sized for the peaks sits unused the rest of the time. Most teams cover the steady baseline and leave the peaks on demand.
Comparing hours with dollars. AWS's Reserved Instance coverage report counts hours or normalized units, while its Savings Plans coverage report counts spend. Compare coverage across commitment types and clouds in dollars at on-demand prices.
Using the wrong denominator. Only usage a commitment could apply to belongs underneath. Dividing by the whole bill makes coverage look worse than it is and hides where commitments could actually help.
Losing track of expiry dates. Coverage drops the day a commitment ends. Plan renewals before the term runs out, not after the bill shows it.

Where to find it in AWS, Azure and Google Cloud

Where to find Commitment coverage by cloud provider
Cloud	What it is called	Where to find it
AWS	Savings Plans and Reserved Instance coverage	Billing and Cost Management → Savings Plans: the coverage report shows the share of eligible usage costs your plans covered. Cost Explorer's RI coverage report shows EC2 Reserved Instance coverage in hours or normalized units, not dollars.
Azure	Reservation and savings plan coverage	Cost Management has no single coverage figure. From amortized cost data, divide usage priced with a benefit (PricingModel Reservation or SavingsPlan) by all eligible usage, both at pay-as-you-go prices. Microsoft's docs say PayGPrice can be empty on reservation rows; take those prices from the Azure Retail Prices API.
Google Cloud	CUD coverage	Billing → Committed use discounts → CUD analysis → CUD Coverage tab shows the share of eligible spend your commitments covered.

How CloudYali helps

CloudYali Financial Commitments shows coverage for AWS Reserved Instances and Savings Plans, Azure reservations and savings plans, and Google Cloud CUDs side by side, in dollars at on-demand prices, next to utilization, unused commitment and effective savings rate.

See the feature Read how it works in the docs

Commitments & rates
Commitment utilization
Commitment utilization is the share of a commitment you paid for that your usage actually consumed: used commitment ÷ total commitment. Anything below 100% is commitment you paid for and didn't use, so it shows how well a Reserved Instance, Savings Plan, Azure reservation or committed use discount fits real usage.
Commitments & rates
Effective savings rate (ESR)
Effective savings rate (ESR) is net savings as a share of what all commitment-eligible usage would have cost at on-demand prices. Because it subtracts commitment you paid for but didn't use, it is the one rate-optimization number that buying too many Reserved Instances, Savings Plans or committed use discounts can't inflate.
Commitments & rates
Savings Plan (SP)
A Savings Plan is an AWS or Azure commitment to spend a fixed amount per hour on eligible compute for one or three years. Usage up to that amount is billed at lower rates, and the discount follows your usage across instance sizes and, with the most flexible plans, instance families and regions.
Commitments & rates
Reserved Instance (RI)
A Reserved Instance (RI) is a one- or three-year commitment to a specific kind of capacity, such as an EC2 instance type in a region or an RDS database, in exchange for a lower hourly price. It's a billing discount, not a server, and you pay for every hour of the term whether the capacity runs or not.
Commitments & rates
Committed use discount (CUD)
A committed use discount (CUD) is Google Cloud's commitment discount: you commit to a set amount of resources, such as vCPUs and memory in one region, or to an hourly spend, for one or three years, and pay lower prices on that usage. The commitment is billed every month of the term, used or not.
Billing & cost types
On-demand price
On-demand price is the public, pay-as-you-go price for cloud usage with no commitment: you pay per second, hour, gigabyte or request for what you use. It is the baseline that every commitment discount, and metrics such as coverage and effective savings rate, are measured against.

Frequently asked questions

What is a good commitment coverage?
There's no universal target. Most teams cover the usage they're confident will run for the whole term and leave the rest on demand, so sensible coverage for spiky workloads is well below 100%. Raise coverage only while commitment utilization stays high.
What is the difference between commitment coverage and commitment utilization?
Coverage looks at your usage: how much of it a commitment paid for. Utilization looks at your commitments: how much of what you bought got used. Buying more raises coverage and can lower utilization; buying less does the opposite.
Is coverage measured in hours or in dollars?
Both exist. AWS reports Reserved Instance coverage in hours or normalized units and Savings Plans coverage in spend, and Google Cloud's CUD analysis reports the share of eligible spend. Dollars at on-demand prices are the only measure that compares across commitment types and clouds.