Multiple Azure resources are being leveraged to create the AKS cluster. Some resources are free, others are billed.
The table below includes an overview:
Paid Resources
Free Resources
The virtual machine scale set for both the system and the user node pools.
The free tier control plane (without SLA)
The standard or the premium SKU for the control plane.
The managed identity
The compute
AKS extensions like the Open Service Mesh (OSM), the CSI drivers, and many more.
The load balancer and the IP addresses.
The network traffic between the availability zones (if we are using more than one availability zone).
The private endpoint traffic (if we are using a private cluster or connecting to a private Azure service).
AKS Key cost factors
Control Plane
Unlike other managed Kubernetes providers (like EKS from AWS), AKS provides a free managed control plane.
But the ongoing cost sits in your node pools. And the biggest cost driver in AKS is mostly the compute part. Though other cost factors such as networking, storage and monitoring also add up.
Node pools
In AKS, you deploy pods on your running working nodes to run your application. All the beautiful stuff is happening. But at the same time, you are paying for those virtual machines (VMs).
So it's not the number of pods that you are paying for — it's actually the number of nodes that are running those pods. The nodes behind your AKS cluster are the real cost drivers.
Storage Costs
Storage also plays a big role in AKS costs. Azure provides multiple storage options, each with its own pricing model and performance tier. Thus, your choice – from Azure Disk, Blob, Files shares — directly impacts your bill.
Rates also vary by region, so where you deploy your cluster matters just as much as what you choose.
Another important factor to consider is monitoring. You can use several monitoring tools in AKS, (such as Container Insights, Log Analytics, etc.).
Most monitoring solutions, like Azure Monitor are priced based on how much data you push in.
If you aren’t careful, you can overload your monitoring system with excessive data, which can increase costs. Therefore, it's essential to control the volume of data that you are pushing (logging data, logs, metrics):
When your system is running without issues, you want to minimise logging.
When issues arise, you want to increase logging to determine the cause.
This is the critical point: You will be paying regardless of the monitoring system you use. The cost will only increase as you increase the amount of monitoring data.
Data transfer costs
Data movement in between AKS costs money (like when it goes out to the internet).
Here’s a breakdown of estimated outbound rates per GB:
Transfer type
Cost (per GB)
Region
Inbound data to Azure
Free
All Azure regions
Outbound to Azure Virtual machines
$0.01
East US
Outbound to internet
$0.087
East US
Transferring data within the same region is cost-effective. But cross-region or external transfers can quickly drain your AKS pocket.
Networking costs
The cost of networking in AKS is dependent on your scenario. In AKS, you can deploy either a public or a private cluster.
When you deploy private clusters for security and compliance motives, you’d want everything to connect over private IPs as well — for example, AKS, ACR (Azure Container Registry), Key Vault, Storage. However, sometimes, when the number of apps are running and clusters are using these components, it creates a mesh of these private endpoints.
That kind of gives an exponential rise in the number of private endpoints. And you may not know that you are actually paying for private endpoints (they aren’t free). So, that can impact your networking cost as well. Perhaps it’s not that significant, but still, every bit counts.
Hidden costs in AKS global setups
There are also costs that we need to pay attention to when using AKS in a global architecture.
Examples include:
The virtual network peering (if we are using AKS cluster in the hub-and-spoke network or pattern).
Application Gateway for Containers
Secrets and certificates stored in another Key Vault — this means I’ll be leveraging that Key Vault with the AKS infrastructure.
Or you might as well use:
The AKS Backup Extension to create a cluster backup using the Backup Vault.
All of these are resources that will add up to your overall cloud bill.
AKS Pricing Tiers
AKS offers three pricing tiers for control plane management:
Free tier
Standard tier
Premium tier
1. Free tier
With the AKS free tier, the control plane is free. The tier is best for experimenting with AKS at no additional cost or for small-scale dev/test clusters with less than 10 nodes. Here, you only pay for the underlying resources, such as VMs, storage, and network.
2. Standard tier
The Standard tier offers a financially backed uptime SLA and support for larger clusters. It supports up to 5,000 nodes in a cluster and offers high availability and reliability for enterprise-grade production workloads.
You pay a cluster management fee of $0.10 per hour per cluster, including:
SLA of 99.95% for the Kubernetes API server endpoint if your cluster uses availability zones
99.9% if it doesn’t.
Additionally, you pay for underlying infrastructure such as compute, network and storage consumed by your cluster.
3. Premium tier
The premium tier is designed for mission-critical workloads requiring long-term support and even higher reliability. This tier is priced at $0.60 per cluster per hour and has all the features from the standard tier with long-term support and additional reliability guarantees.
The table below shows when to use which tier, including it’s pricing:
Tier
When to use it
Supported cluster types
Pricing
Features
Free Tier
- Learning Kubernetes or experimenting
- Want to try and experiment for low cost
- Dev/test clusters
- Starter clusters with fewer than 10 nodes
- No cluster management fee
- Pay only for the VMs and other resources used
- Supports all AKS features
- Suitable for clusters with less than 10 nodes (but can support up to 1000)
If you use Azure Kubernetes, chances are you’ll also use other Azure services alongside your cluster – like Azure OpenAI, Microsoft Defender for Cloud, Azure Monitor; you name it.
These services aren't always part of the core infrastructure. Meaning, your cluster doesn’t depend on them like on compute, networking, or storage. But they’re often essential for security, observability, or AI-driven workloads.
And each of these added services has its own pricing model and agreements. You won’t see their cost in your bill directly, but they do contribute to your overall spend.
If you're serious about optimising AKS costs, you must also account for the costs of these services.
Reduce AKS Costs with Intercept
A Microsoft partner like Intercept can help you with precise and detailed cost calculations.
Contact us if you need help to get insights into your AKS bill and let us help you achieve cost savings!
If you only want to try out AKS and experiment (like maybe building proof-of-concept workloads), you can use AKS for free by leveraging the Azure free tier. This means no commitment – you can cancel anytime.
This also includes access to other core services and a $200 credit to explore additional paid offerings.
Keep in mind:
While these services are free to use, you may still incur charges for related resources like storage or data transfer. Also, it doesn’t include an SLA.
Pay-as-you-go
The pay-as-you-go model offers the most flexibility for AKS pricing. It’s an excellent example of obtaining and running your workloads on demand. You only pay for what you use, without upfront expenses or commitments. Meaning, you can quit anytime.
This plan suits environments with variable workloads, where scaling resources up or down as needed is crucial. Think of applications having traffic spikes multiple times spread out through the day.
Azure Reservations can help you save up to 72% compared to pay-as-you-go pricing for compute resources in AKS.
Reservations are restricted to specific SKU families and regions, which must be specified upfront. Hence, think twice about them if you have a global AKS set up or plan to set one up in the future.
Generally, they are best for stable and predictable workloads (with no unexpected SKU/region changes about to occur).
Azure Savings Plans for Compute
Azure Savings Plans are another discount plan you can leverage to reduce the compute costs by up to 65% compared to pay-as-you-go prices. And just as with reserved instances, this also applies in AKS.
To receive this discount, you must commit to a fixed hourly spend, e.g., $20.00, for either 1 or 3 years. This unlocks lower rates and remains in effect until your commitment is fulfilled.
They are best fitting when you have dynamic workloads that may need flexibility for future changes, or you consistently spend $X per hour but resources have a variety of SKUs/regions.
Spot Virtual Machines
Similar to the free tier, this plan is best suited for development and testing environments. Azure Spot Virtual Machines (VMs) use Microsoft Azure’s surplus compute capacity at deep discounts.
Theoretically, you can save up to 90% with Spot VMs compared to pay-as-you-go prices. However, the actual discounts vary depending on available capacity and demand.
Again, they’re not reliable for production use. Neither do they combine well with reservations nor savings plans. We recommend selecting one model based on your workload needs.
Azure Hybrid Benefit
This only applies if you're using Windows-based node pools (sorry to those with workloads running on Linux).
When you run Windows nodes in AKS, part of the cost comes from the Windows Server license (charged per vCPU).
That means: larger nodes = higher licensing costs.
If your organisation owns on-prem Windows licenses, Azure Hybrid Benefit lets you reuse them in Azure, reducing costs.
AKS Cost Management Tools
If you want to manage and optimise AKS costs, one of the first and most essential steps is monitoring. It helps you understand:
How resources are used
Identify budget deviations
Analyse historical trends
Detect cost anomalies
Pinpoint expensive workloads or cluster optimisation opportunities
Fortunately, there are various tools available to help you understand your AKS bill.
Microsoft Cost Management
Microsoft Cost Management is the ideal tool for tracking and managing Azure spend, offering clear visuals and charts that help you understand current usage and forecast future costs.
For an overview of your costs, head to “Cost Analysis”.
The AKS Cost Analysis
The AKS cost analysis add-on in Microsoft Cost Management gives detailed insights into your cluster infrastructure spend.
Source:Microsoft
With AKS Cost Analysis, you can drill into specific compute, network, and storage resource costs within a cluster. You can see how much cost is attributed to running apps, to system-related processes, and to idle capacity.
Filter cost by using the filter option to see Azure spend by resource, service, or subscription.
It’s also important to look at your cost data alongside actual utilisation data, so you can act before costs spiral. That data can come from Azure Monitor.
You can optimise data ingestion with Azure Monitor by adjusting collection frequency or limiting collection to specific namespaces you're most concerned with. This helps reduce unnecessary overhead and sharpens your focus.
What’s more, it also helps track pod container crashes and restarts. This ensures the Kubernetes cluster is healthy and has enough nodes to keep workloads running smoothly.
Azure Advisor
Azure Advisor includes AKS cost recommendations based on best practices and tailored to your cluster setup.
Source:Microsoft
It suggests actions like:
Enabling Cluster Autoscaler to scale nodes in/out based on demand
Purchasing a Reserved Instance or Savings Plan for discounts on Azure compute
Intercept Customer Portal
The Intercept Customer Portal, available only to Intercept customers, gives you a clear and real-time view of your Azure costs.
Overview of the Intercept Customer Portal
Our portal goes far beyond what the standard Azure bill provides, offering features like:
Invoice Management
Real-time insight into Azure spend
Recommendations
You can even down your spend by service, subscription, resource, or resource group which makes it easier to track and control expenses.
Would you like to know what the portal looks like and what you can do with it?
