AI Infrastructure Total Cost of Ownership (On-Prem vs Cloud GPU) Calculator
Compare on-prem and cloud GPU costs using user-provided assumptions. Defaults are examples only.
About This Calculator
AI Infrastructure Total Cost of Ownership (On-Prem vs Cloud GPU) Calculator is designed to reduce manual errors and give repeatable outputs when you need quick, reliable answers.
Compare the true monthly and multi-year cost of running AI workloads on your own GPUs versus renting from cloud GPU providers.
If your workflow expands, pair this calculator with LLM Token & Cloud GPU Cost Estimator and LLM Vendor Cost Comparison – API vs Self-Hosted to cross-check assumptions and build a stronger analysis chain.
Formula
C_capex = N * C_hw * (1 + o); C_amort_month = C_capex / (Y * 12); kWh_gpu = P * hours_month * PUE; kWh_total = N * kWh_gpu; C_power_month = kWh_total * p_e; C_onprem_month = C_amort_month + C_power_month + C_dc; C_cloud_month = N * hours_month * p_cloud; if C_cloud_month > C_onprem_month then months_breakeven = C_capex / (C_cloud_month - C_onprem_month).
Example Calculation
The worked example below demonstrates how the input fields translate into the final output. Use it as a quick validation pass before entering your own numbers.
- numGpus: 8
- hardwareCostPerGpu: 35000
- infraOverheadFactor: 0.4
- amortizationYears: 4
- gpuPowerKw: 0.7
- pue: 1.4
- electricityPricePerKwh: 0.12
- hoursPerMonth: 400
- datacenterMonthlyCost: 3000
- cloudPricePerGpuHour: 4.5
Explanation of Results
Result Interpretation
With these assumptions, cloud remains slightly cheaper per month; the on-prem cluster never beats cloud within the 4-year amortization window, so no clear break-even point appears.
FAQ
How should I estimate realistic GPU utilization hours?
Use measured scheduler logs or production monitoring to estimate average monthly utilization hours per GPU under your expected workload mix.
Can I include staff costs and cooling separately?
Yes. Enter recurring costs in the datacenter monthly cost field if you want those costs reflected in on-prem TCO.
Do tax benefits (depreciation) affect the calculation?
This calculator is a direct cost model; tax treatment and depreciation schedules should be evaluated separately in your finance process.
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See Also
Other calculators in AI Infrastructure & LLM Economics