Cost Management with Azure Resource Manager MCP

Microsoft

Aug 25, 2026

Today, we’re announcing new Cost Management capabilities in the Azure Resource Management (ARM) MCP server. A core set of cost tools is now available by default, making it easier for AI agents to bring cost context into Azure workflows without additional configuration. For more advanced scenarios, you can enable the optional Cost Management toolset to access an expanded set of capabilities.

Cloud operations and cloud economics are deeply connected, but the data required to make those decisions is often fragmented across different tools and experiences. The default cost capabilities help AI agents combine Azure resource information with essential cost insights in the workflows where cloud decisions are made. When you need broader coverage, the optional Cost Management toolset extends that experience with additional tools for deeper analysis, planning, and optimization.

What You Can Do Today

Plan Before You Deploy

Every cloud project starts with a series of tradeoffs. Before resources are deployed, teams need to understand how architectural decisions, resource choices, and regions will impact cost.

An AI agent can estimate costs, compare deployment options, and factor in negotiated rates where available so you can evaluate cost alongside technical requirements before deployment.

Examples

"Estimate the monthly cost of deploying a three-node AKS cluster with my negotiated pricing.”
“How would my estimated monthly cost change if I updated the VM in this ARM template <ARM Template> from Standard_D8s_v5 to Standard_D2s_v5? and is that within our organization’s policy?”

Understand Costs

Once workloads are running, cost visibility becomes the priority. An AI agent can query your cost data to explain cost trends, changes in spend, and surface cost drivers.

Example

"What were my top cost drivers this month?"

Manage Cloud Spend

With visibility in place, budget and alerts help teams avoid surprises. An AI agent can create and review budgets and check alerts so you can see where spend is tracking against your plans.

Example

“How am I doing against my budgets this month?”

Understand and Manage Spend

As cloud environments grow, identifying the highest-impact savings opportunities becomes increasingly challenging.
An AI agent can surface appropriate Advisor cost recommendations so you can prioritize actions to improve savings.

Example

"Show me any eligible Savings Plans recommendations that would save me at least $200/month.”

Analyze AKS Workloads

If you’re running AKS workloads on Azure, an AI agent can query AKS cost data by cluster and namespace and compare active and idle capacity.

Example

“Show me how much of my AKS spend is idle vs actively used in my current subscription”

Make Cost-Aware Azure Decisions

Whether you're evaluating a new deployment, investigating spending changes, tracking budgets, identifying savings opportunities, or analyzing AKS workloads, the Cost Management capabilities in the Azure Resource Management (ARM) MCP server help bring financial context directly into Azure workflows. By combining Azure resource information with cost, pricing, budget, and optimization insights, AI agents can help you make more informed decisions without switching between multiple tools and experiences.

What's Included

The Azure Resource Management (ARM) MCP server supports the following Cost Management scenarios:

Query – Explore historical spend, understand cost trends
Forecast – Project future costs based on current usage
Budgets and alerts – Create, review, and monitor budgets and alerts to help teams stay ahead of overruns.
Reservations and Savings Plans – Review recommendations and utilization data to identify commitment-based savings opportunities.
Pricing – Retrieve retail pricing and negotiated price sheet details where available.

Default Cost Management capabilities

A core set of tools is enabled by default, allowing agents to support common cost analysis and pricing scenarios without additional configuration.

Capabilities	Supported Tools
Query	query_costs query_aks_costs
Pricing	get_retail_prices start_pricesheet_download get_pricesheet_status

Additional Cost Management capabilities

For broader cost-management scenarios, you can enable the optional Cost Management toolset. This extends the default experience with additional tools for dimensions, forecasting, budgets, alerts, reservations, and Savings Plans.

Capabilities	Tools
Query	list_dimensions
Forecast	forecast_costs
Budget & Alerts	list_budgets get_budget create_budget list_alerts
Reservations & Savings Plans	get_benefit_recommendations list_benefit_utilization list_reservation_transactions

Getting Started

Pre-Requisites

VS Code installed
Valid Azure account with appropriate permissions
GitHub Copilot subscription

Installation

Install ARM MCP - https://aka.ms/JoinARMMCP
- VS Code launches automatically
- Click Install under Azure Resource Manager MCP Server
- Sign in with your Azure credentials
- If you hit any authentication issues see the Troubleshooting Guide in the ARM MCP repo

Add cost header to the Azure Resource Manager MCP configuration file for access to optional cost tools
- Opt-in per client with x-mcp-toolset header: CostManagement
- For GitHub Copilot Chat (in VS Code)
  - Configure mcp configuration file for a specific workspace or globally
    - Option 1 (Workspace): configure vscode/mcp.json file in your repo
    - Option 2 (User): Edit mcp.json file in User Configuration:
  - Open the Command Palette (Ctrl+Shift+P / Cmd+Shift+P)
  - run MCP: Open User Configuration and edit the mcp.json it opens

{
	"servers": {
		"azure-resource-manager-mcp": {
			"type": "http",
			"url": "https://mcp.management.azure.com",
			"headers": {
				"x-mcp-toolset": "CostManagement"
			}
		}
	}
}

- - Save the file, then restart the server: open the Command Palette and run MCP: List Servers, pick azure-resource-manager-mcp, and choose Restart. The new tools will appear under Configure Tools in Chat.

- For GitHub Copilot CLI
  - Edit ~/.copilot/mcp-config.json with the relevant CostManagement header

{
	"mcpServers": {
		"azure-resource-manager-mcp": {
			"type": "http",
			"url": "https://mcp.management.azure.com",
			"headers": {
				"x-mcp-toolset": "CostManagement"
			}
		}
	}
}

- - Restart the MCP server to pick up the change. In Copilot CLI today this means exiting and relaunching copilot. Verify the server is running with the /mcp show slash command inside copilot.

What's Next?

Microsoft Cost Management is actively expanding our agentic cost capabilities. Upcoming capabilities will include additional supported tools and skills.