Optimize CPU Costs for Windows Licensing

By Craig Cooley

Reduce Microsoft licensing costs on Amazon EC2 and SQL Server instances by disabling hyperthreading (setting ThreadsPerCore = 1). This PowerShell script calculates potential savings and helps you understand the cost impact across instance types.

Why This Matters

Windows Server and SQL Server are licensed per active vCPU on AWS. By default, most EC2 instance types have 2 vCPUs per physical core (also known as hyperthreading). If your workload doesn't benefit from hyperthreading, you're paying for twice the licensing you need.

Setting ThreadsPerCore = 1:

• Halves your Windows/SQL licensing cost (AWS License Included pricing is per active vCPU)
• Does not affect the compute cost — only the license component
• see Optimize CPUs for License-Included instances for details

Scripts

The 2 PowerShell scripts in the Scripts folder demonstrate cost savings across instance types by querying the AWS Pricing API and comparing License costs with and without hyperthreading. The SSM Automation (Set-ThreadsPerCore.yaml) can be used to configure ThreadsPerCore = 1 on multiple instances at once. Individual instances can be configured from the AWS console or Command Line.

Script	Description
Show-OptimizedCpuCost.ps1	Shows per-instance cost savings when setting ThreadsPerCore=1
Show-AccountCpuOptimization.ps1	Scans instances in your account and shows optimization opportunities
Set-ThreadsPerCore.yaml	SSM Automation document to set ThreadsPerCore on existing instances

Requirements

• PowerShell 7+ (pre-installed in AWS CloudShell)
• AWS.Tools.EC2 and AWS.Tools.Pricing modules (pre-installed in AWS CloudShell)
• AWS credentials with EC2 and Pricing API permissions

How ThreadsPerCore Works

When launching an EC2 instance, you can specify CPU options:

New-EC2Instance -InstanceType m8i.4xlarge `
    -CpuOption_ThreadsPerCore 1 `
    -CpuOption_CoreCount 8

This launches with 8 cores × 1 thread = 8 vCPUs instead of the default 8 cores × 2 threads = 16 vCPUs. Windows licensing is charged per vCPU, so you pay for 8 licenses instead of 16.

Applies To

• EC2 Windows — Windows Server License Included instances
• SQL Server on EC2 — SQL Server License Included instances
• RDS for SQL Server — Latest RDS instance have ThreadsPerCore = 1 set by default

Author

Craig Cooley (coolcrai@) — Built with Kiro IDE