Most early-stage startups don't have an AWS cost problem.
They have an infrastructure decision problem.
For production workloads, NAT Gateways are usually the right choice. They're managed, highly available, and require virtually no maintenance.
But for non-production environments?
The economics often don't make sense.
AWS NAT Gateway is one of those services that quietly appears in many architectures.
It solves a legitimate problem:
Resources running in private subnets need outbound internet access for things like:
Pulling container images
Downloading OS updates
Accessing third-party APIs
Installing dependencies
The NAT Gateway handles all of this without requiring you to manage any infrastructure.
The tradeoff?
You pay for that convenience every hour it exists.
Even if very little traffic passes through it.
A Real World Example
The client I was working with had:
Production environment
Non-production environment
The non-production environment existed primarily for:
Testing deployments
QA testing
Traffic was minimal.
Downtime was acceptable.
No customers depended on it.
Yet the environment was still using a NAT Gateway.
When we compared costs, the NAT Gateway represented a significant percentage of the monthly spend for that environment.
That led us to consider a simpler alternative.
NAT Gateway vs NAT Instance
A NAT Instance is simply an EC2 instance configured to forward outbound traffic for private resources.
Instead of paying for a managed service, you can operate the NAT layer yourself.
For non-production environments, a small NAT Instance can often provide the same functionality at a fraction of the cost.
Option | Approx Monthly Cost | Operational Overhead | Recommended For |
|---|
NAT Gateway | ~$32-$35 | None | Production |
t4g.nano NAT Instance | ~$3-$5 | Low | Small non-prod |
t4g.micro NAT Instance | ~$6-$8 | Low | Larger non-prod |
Note: Pricing varies by region and usage patterns.
More importantly, the operational overhead is often acceptable.
The exact savings depend on traffic levels, but it's not uncommon to reduce networking costs by 70-90% for non-production workloads.
Why I Wouldn't Choose Nat Instance in Production
This is where many cost optimization techniques go wrong.
They assume cheaper automatically means better.
It doesn't.
For production environments, I always recommend NAT Gateway.
Why?
Because NAT Gateway provides:
Managed infrastructure
Better reliability
Automatic scaling
No patching
No maintenance burden
The operational simplicity is worth paying for.
Production systems should optimize for reliability.
Why I Often Recommend NAT Instances for Non-Production
Non-production environments have different goals.
They're designed for:
Development
Testing
Validation
Experimentation
Not customer-facing workloads.
If a NAT Instance fails:
Developers may be inconvenienced
Testing may pause temporarily
But customers aren't impacted.
Revenue isn't impacted.
That changes the economics completely.
For many early-stage startups, saving $25-$30 per month per environment is a reasonable tradeoff.
The Bigger Lesson
The interesting part isn't NAT Gateway versus NAT Instance.
The interesting part is how infrastructure decisions are made.
I frequently see startups adopt production-grade solutions everywhere because that's what AWS documentation recommends.
But AWS best practices are designed to work for organizations of every size.
Your startup doesn't need to operate like Amazon.
Infrastructure should be designed around business requirements, not vendor defaults.
Further Reading
If you'd like to implement this yourself:
Final Thought
Many startups focus on reducing AWS costs through discounts, Savings Plans, and Reserved Instances.
Those are useful.
But the biggest savings often come from asking a simpler question:
Are we solving a production problem in a non-production environment?
Sometimes the answer is a NAT Gateway.
Sometimes it's a $5 EC2 instance.
The right choice depends on the impact you're trying to create.
Until next time…