AWS CCP Exam Prep: Understanding AWS Billing, Pricing and Support - Part 3

Welcome to part 3 of my AWS Certified Cloud Practitioner exam prep series. This post continues where Part 2 left off, taking a CCP exam-level look at AWS Billing, Pricing and Support. In part 1, I covered AWS pricing models. In part 2, I covered storage options and tiers. Parts 1 and 2 fall under Task Statement 4.1: Compare AWS Pricing models ​. Part 3 begins AWS Task Statement 4.2: Understand resources for billing, budget, and cost management ​.

All examples here use us-east-2 unless otherwise noted.

This post focuses on AWS CCP Exam Task Statement 4.2: Understand resources for billing, budget, and cost management.

My last practice test results after writing parts 1 and 2 and before writing part 3:

• 70% required to pass.
• My Score: 75%
• 49 out of 65 questions correct.
• Result: Passed.

Please note that, while writing parts 1 and 2 definitely contributed to the improvement in my score, I have been studying in other ways as well.

These results are encouraging. There were a lot of questions on this version of the practice test where I wasn’t sure what the correct answer was. However, as encouraging as these results are, I know I need to do better and be more confident before I actually take the exam. Also, according to the practice exam results, Billing and Pricing was once again my weakest category, with a category score of 44% correct and 56% incorrect.

The next Task Statement under the content domain is AWS Task Statement 4.2: Understand resources for billing, budget, and cost management ​.

This task statement covers:

• Billing Support and Information.
• Pricing Information for AWS services.
• AWS Organizations.
• AWS Cost Allocation Tags.

There is a lot of overlap here, so instead of following the categories defined by AWS, I’m going to look at this information from a specific service/category level.

The first item I’m going to cover is cost allocation tags. I frequently miss questions about cost allocation tags on the practice tests.

The AWS page on Organizing and tracking costs using AWS cost allocation tags defines Cost Allocation Tags as follows:

“A tag is a label that you or AWS assigned to an AWS resource. Each tag consists of a key and a value. For each resource, each tag key must be unique, and each tag key can have only one value.”

OK, that seems pretty simple. Cost Allocation Tags are like a key/value pair in programming terms. They likely literally are a type of key/value pair in the AWS billing system. So, like a key/value pair in most systems, each key must be unique and each key can have only one value.

AWS goes on to state that cost allocation tags can be used to organize resources. They create a way to track AWS costs at a detailed and customizable level.

Cost allocation tags must be activated before they can be used. Once activated, they organize resource costs on your cost allocation report. This makes it easier to categorize costs, using properties the account holder can define.

There are two types of cost allocation tags: AWS-generated and user-defined.

As the names imply AWS creates the AWS-generated cost allocation tags and the user must create the user-defined cost allocation tags. Both types must be activated separately before they can appear in Cost Explorer or on cost allocation reports.

Tags are activated in the Billing and Cost Management console.

Tags do not apply retroactively.

The AWS Analyzing your costs and usage with AWS Cost Explorer page defines AWS Cost Explorer as follows:

AWS Cost Explorer is a tool that enables you to view and analyze your costs and usage. You can explore your usage and costs using the main graph, the Cost Explorer cost and usage reports, or the Cost Explorer RI reports.

AWS Cost Explorer allows you to view data for up to the last 13 months. It can also be used to forecast how much you’re likely to spend for the next 18 months.

So, Cost Explorer allows you to view actual usage and forecasted usage.

AWS Cost Explorer can also give recommendations for what Reserved Instances to purchase.

The AWS Cost Explorer interface can be used free of charge. However, there is a charge of $0.01/request for using the Cost Explorer API.

Cost Explorer cannot be disabled after it has been enabled. It is enabled by opening it for the first time through the AWS Cost Management console. It cannot be enabled with the API.

Cost Explorer is not real-time. It updates at least once every 24 hours.

Cost Explorer uses the same dataset that is used for the AWS Cost and Usage Reports and detailed billing reports.

If you have created, activated, and applied Cost Allocation Tags to resources, then these tags can be used to filter or group costs by key in Cost Explorer.

According to the AWS page What are AWS Cost and Usage Reports , “AWS Cost and Usage Reports (AWS CUR) contains the most comprehensive set of cost and usage data available.”

The key for the AWS CCP exam is to remember that AWS Cost and Usage Reports are the “most comprehensive.” These reports are where account holders can find the most detailed information regarding AWS usage.

AWS Cost and Usage Reports can be published to a specified AWS S3 bucket that you own.

Costs can be broken down by hour, day, or month, by product or product resource, or by tags that you define yourself.

AWS updates the report in the S3 bucket once a day in CSV (or Parquet) format. However, the schedule can be customized to update up to three times a day.

It takes up to 24 hours for the first report to be delivered after the report is defined.

AWS Cost and Usage reports track AWS usage and provide estimated charges associated with your account.

Aggregation can be customized by hour, day or month.

AWS Budgets is a tool that can be used to track and take action on AWS costs and usage. It is used for cost and usage tracking.

With AWS Budgets, a user can:

• Set a monthly cost budget with a fixed target amount to track all costs associated with your account.
• Choose to be alerted for both actual and forecasted. Actual alerts when the budget is exceeded and forecasted alerts before the budget is exceeded, but is forecasted to be exceeded.
• Set a monthly cost budget with a variable target amount. Each month can grow the budget target by 5 percent.
• Set a monthly usage budget with a fixed usage amount and forecasted notifications.
• Set a daily utilization or coverage budget to track RI or Savings Plans .
• Set a custom budget that aligns with a specific date range, such as a fiscal year, project duration or grant period.

AWS Budgets supports the following types of budgets:

• Cost budgets.
  • Set spending limits for services and receive alerts when the defined threshold is approaching or exceeded.
• Usage budgets.
  • Set spending limits for usage and receive alerts when the defined usage threshold is approaching or exceeded.
• RI utilization budgets.
  • Establish usage limits for one or more services and receive alerts when the usage threshold is approaching or exceeded.
• RI coverage budgets.
  • Establish a utilization threshold for your RIs and receive alerts when usage falls below the defined level.
  • This helps identify unused or under-utilized RIs.
• Savings Plans utilization budgets.
  • Establish a utilization threshold for your Savings Plans and receive alerts when usage drops below the defined level.
• Savings Plans coverage budgets.
  • Define a coverage threshold and receive alerts when the percentage of your eligible usage covered by Savings Plans falls below the defined level.
  • This helps track how much of your usage is covered by Savings Plans.

Optional notifications can be set up to:

• Warn if a budget is exceeded, or is forecasted to be exceeded.
• Warn if you fall below your target utilization and coverage for RI or Savings Plans budgets.

Optional notifications can be sent to:

• An Amazon SNS topic
• An email address
• Both an Amazon SNS topic and an email address

If consolidated billing is used, then access to budgets can be controlled through IAM policies.

Owners of member accounts can create their own budgets by default, but cannot create or edit budgets for other users.

A budget is only visible to users with access to the account that created the budget, and have access to the budget itself.

Even though this post is related to Billing, Pricing and Support, I’m still going to cover AWS Organizations as a whole here.

According to the AWS What is AWS Organizations page, “AWS Organizations helps you centrally manage and govern your environment as you grow and scale your AWS resources.”

Organizations can be used to:

• Add accounts.
• Group accounts.
• Apply policies.
• Enable AWS services.

New accounts can be grouped into Organization Units (OUs). These are groups of accounts that serve a single application or service.

AWS Organizations lets an organization:

• Secure accounts and automate the creation of AWS accounts.
• Control access and permissions.
• Share resources, such as VPCs and software licensing, within your organization.
• Audit your environment by activating AWS CloudTrail across accounts.
• Centrally manage billing and costs by providing a single consolidated bill.

From my perspective, the key point to remember for AWS Organizations is that it is a tool specifically designed for organizations managing multiple accounts under a single organizational umbrella.

The AWS Free Tier is a free plan that allows usage of AWS for up to 12 months, without cost or commitment. Only certain services are eligible for the free tier, and utilization limits also often apply.

Some AWS Services are always free. Examples of always free services are AWS Identity and Access Management (IAM), AWS Organizations, AWS Cost Explorer (basic features), AWS Budgets (SNS notifications may still incur costs), AWS Trusted Advisor (Core checks only), and AWS Artifact.

Some services are available for a free trial period.

• Cost Allocation Tags are for categorizing information on billing reports.
• Cost Allocation Tags are key/value pairs. Meaning each key must be unique and each key can have only one value.
• There are two types of Cost Allocation Tags: AWS-generated and user-defined.
• Both types of Cost Allocation Tags must be activated before they can be used.
• Cost Allocation Tags are activated in the Billing and Cost Management Console.
• Cost Allocation Tags appear on reports.
• Do not apply retroactively.

• Cost Explorer is a tool that allows you to view and analyze your costs and usage.
• It is higher level than the more detailed Cost and Usage Reports.
• Cost Explorer supports reporting for actual usage (up to the last 13 months) and forecasted usage (up to the next 18 months).
• Cost Explorer can give recommendations for what Reserved Instances to purchase.
• Cost Explorer cannot be disabled after it is enabled.
• Cost Explorer is not real-time. It updates at least once every 24 hours.
• Cost Explorer uses the same data set that is used for the Cost and Usage Reports and detailed billing reports.
• Cost Explorer = High Level Analysis, Cost and Usage and detailed billing reports = Detailed reporting.

• The most comprehensive reports available with the most detailed information regarding AWS usage.
• Costs can be broken down by hour, day, month, product resource or user-defined tags.
• Reports can be published to a customer-owned S3 bucket.
• AWS defaults to updating the report in the S3 bucket once a day. This schedule can be changed to up to three times per day.
• It takes up to 24 hours for the first report to be delivered after the report is defined.
• Aggregation can be customized by hour, day or month.
• Cost and Usage and detailed billing reports = Detailed reporting, Cost Explorer = High Level Analysis

• Used to set fixed targets to track usage: cost budgets for tracking dollars spent, usage budgets for tracking units.
• Can alert on actual or forecasted usage.
• Supports cost budgets, usage budgets, and RI or Savings Plan utilization and coverage budgets.
• Can warn if a budget is exceeded or forecasted to be exceeded.
• Can warn if a customer falls below a target utilization and coverage for RI or Savings Plan budgets.
• Notifications can be sent to an SNS topic, an email address, or both.
• If consolidated billing is used, then access to budgets can be controlled through IAM policies.
• Mental note for exam: If you need to be notified before or when a threshold is exceeded, use AWS budgets.

• Central management and governance of your environment as it grows and scales.
• For organizations managing multiple accounts.
• Can add and group accounts, apply policies and enable/disable AWS services.
• Supports sharing of resources between accounts.
• Supports centrally managing billing and costs using a consolidated bill.
• Mental note for exam: Large organization, multiple account management features = AWS Organizations.

• A free plan that allows certain resources to be used without cost or commitment for up to 12 months.
• Some services are always free. IAM, AWS Organizations, AWS Cost Explorer, AWS Budgets (excluding SNS), AWS Trusted Advisor (Core checks only), and AWS Artifact are examples of always free services.
• Some services are free for a trial period.
• Mental note for exam: AWS offers a free tier for experimentation and learning, there are time and resource limits, and some services are always free.

That brings me to the end of my notes for part 3. In part 4 of the series, I’ll continue looking at pricing information for AWS services. I’ll be taking another practice test after publishing this post and will again post my updated score in part 4. If you’re reading this as study prep for the AWS CCP exam, I hope you found the information helpful and best of luck on the exam!