"No Upfront - You pay nothing upfront but commit to pay for the Reserved Instance over the course of the Reserved Instance term". Presumably, you'll be billed each month (for 12 months) whether you're using it or not. Of course, if you close your AWS account entirely, they'd have to come after you if they wanted to collect -- but if you're not planning to go out of business, then you shouldn't expect to be able to just drop the instance mid-year.