5 Best Snowflake Cost Optimization Techniques (2024)


In today’s data-driven world, it’s important for businesses to be able to easily manage and analyze large datasets. With its cloud-based data warehouse services, Snowflake provides a strong answer by letting users access data storage and computing power whenever they need it. But while Snowflake gives you a lot of power and freedom, it also makes managing costs more difficult. 

To make sure you get the most out of your Snowflake investment without paying too much, you need to know how to optimize these costs. This blog post goes into detail about how Snowflake sets its prices, looks at effective ways to lower costs, and gives you useful advice to help you lower your Snowflake costs. These tips will help you make your Snowflake setting more efficient and save money, whether you are a new user or just want to make your current setup better.

How Snowflake's Pricing Model Works

Source: Snowflake

To effectively manage and optimize costs within Snowflake’s consumption-based pricing model, it’s crucial to grasp how charges are accrued across different usage dimensions. Snowflake’s pricing is dynamic and can vary based on several factors including the selected cloud provider, geographic region, plan type, and additional services utilized. Below, we simplify the main components that contribute to Snowflake costs, focusing specifically on a common scenario using AWS in the US East region.

Understanding Snowflake's Pricing Components

Snowflake’s pricing structure is primarily divided into three main areas:

  • Storage: This is charged based on the amount of data stored in your Snowflake environment, calculated per terabyte per month. For example, in the AWS US East region, the typical rate is around $40 per terabyte per month.
  • Compute: Charges for compute resources are measured in Snowflake Credits, which vary in price depending on your chosen plan—Standard, Enterprise, or Business Critical. These credits are priced at $2.00, $3.00, or $4.00, respectively. Compute costs are incurred based on the size and number of virtual warehouses you operate and how long they run.
  • Cloud Services: These costs cover the background operations necessary for query compilation, optimization, and metadata management. Like compute, these are also billed based on the consumption of Snowflake Credits.
  • Serverless Features: Any usage of Snowflake’s serverless capabilities (like additional on-the-fly data processing or analytics services) will also be charged based on actual usage.

Snowflake's Dynamic Pricing Model

Snowflake has both standard prices and a dynamic pricing approach that changes prices all the time. This model works especially well when figuring out the best price is affected by things like inventory levels, competitor prices, and changes in buyer demand. This gives businesses the freedom to make the most money from each deal.


Top 5 Techniques for Snowflake Cost Optimization

Optimizing costs in Snowflake involves several strategies that leverage its flexible pricing model. Here are the most effective ways to reduce your expenditure:

1. Right-Size Your Compute Resources

  • Match Warehouse Size to Workloads: Utilize smaller warehouses for lighter workloads and reserve multi-cluster warehouses for peak times or concurrent access scenarios.

  • Auto-Suspend and Auto-Resume: Configure warehouses to automatically suspend when idle and resume when needed, reducing unnecessary compute charges.

2. Optimize SQL Queries

  • Streamline SQL Commands: Simplify queries to reduce the computational load. Avoid complex joins and subqueries where possible and make use of query optimization features like caching.

  • Use Materialized Views: Materialized views store pre-computed results that can be reused for multiple queries, thus decreasing the total compute time.

3. Manage Storage Efficiently

  • Regularly Clean Up Old Data: Implement policies for data retention that ensure you’re only storing what you need.

  • Use Data Clustering: To improve query performance and reduce the time (and thus cost) associated with accessing unsorted data.

4. Monitor and Analyze Usage

  • Track Warehouse Usage: Use Snowflake’s tools to monitor which warehouses are most active and adjust them according to actual needs.

  • Implement Resource Monitors: Set up alerts to track credit usage and costs so you can adjust your usage proactively rather than reactively.

5. Leverage Snowflake’s Editions and Regions

  • Choose the Right Edition: Snowflake offers multiple editions (Standard, Enterprise, Business Critical, and VPS) each with different features and pricing. Select the one that best fits your needs without overcommitting resources.

  • Select Appropriate Regions: Costs can vary significantly between regions. If possible, choose a region that is cost-effective but still meets your data residency requirements.

Tools for Estimating Costs

It can be hard to figure out how to use Snowflake Credits to turn your normal task into an expected expense. But Snowflake and a number of other third-party providers provide calculators and other tools that can help you get a good idea of these prices. These tools look at how you usually use your money and help you guess how much you’ll spend each month.


Calculate your estimate pricing here:

Businesses can get a better idea of their monthly costs and find the best ways to use Snowflake by keeping a close eye on these parts and using the tools that are available. This way, they can make sure they only pay for what they need and get the most out of the platform.


In Snowflake, managing costs well doesn’t mean sacrificing efficiency. Understanding how Snowflake’s pricing model works and using a mix of the above methods will help businesses use Snowflake’s powerful features while keeping costs low. 

Your company will continue to use Snowflake efficiently and cost-effectively as long as it is reviewed and changed on a regular basis based on real usage patterns and business needs.


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