Setting up Redshift VPC Cluster: Made Easy 101

Subhan Hagverdiyev • Last Modified: December 29th, 2022

Redshift VPC: FI

Amazon’s Data Warehouse solution, Redshift is their best cloud wizardry. In the most basic sense, AWS Redshift is a Data Warehouse. It’s designed specifically for slicing and dicing data and offers historical data analytics. That response, on the other hand, is inadequate.

AWS Redshift was built for and sits atop the world’s largest data center. Nodes, or computational resources, make up the Redshift cluster. Each cluster comprises one or more databases and is powered by the Amazon Redshift engine. You’ll set up a cluster in a Redshift VPC (Virtual Private Cloud) to protect it from public access. A Redshift VPC is essentially a virtual data center in the cloud.

This blog talks about the process of setting up Redshift VPC Clusters and explains it in easier steps. It also gives an introduction to Data Warehouses and Redshift is a good place to start.  

Table of Contents

What are Data Warehouses?

Data Warehouses first appeared in the 1980s (about the same time as mullets) as a solution to problems that relational databases couldn’t handle. Simply put, they addressed the following issues: 

  • Large enterprises have a plethora of relational databases to manage, and they need to be able to run reports across all of them in a consistent manner. 
  • Data from many tables may be used in reporting, requiring the use of (heavy) joins to bring the data together. 
  • Costly queries can put a database out of commission. 

Imagine you have a corporation or organization with a variety of apps and data housed in several databases. It is going to take a while to generate a report from multiple sources, therefore you must integrate the data from such sources and keep it in a centralized point called a Data Warehouse. A Data Warehouse is essentially a centralized database that enables the company to acquire an overview of its business. When users try to obtain reports straight from operational systems, it generates performance concerns, which is one of the reasons why a Data Warehouse is a preferable choice for your organization.

Establishing a single source of truth also helps each department to deliver outcomes that are compatible with those of the other departments. Users may generate their reports without involving IT thanks to the Data Warehouse. The Data Warehouse will typically collaborate with an operational data store (ODS)to get data acquired from the numerous databases utilized by the company. The extract-transform-load (ETL) process, or an equivalent ELT process, is a way of extracting data from a database, converting it into the ODS, and putting it into a Data Warehouse.

A Data Warehouse is a useful tool for data analysis since it captures converted (i.e. cleaned) historical information. Business units are typically engaged in how the data is arranged since they will utilize the warehouse data to develop reports and do data analysis. It often utilizes SQL to query the data, and tables, indexes, keys, views, and data types are used for data management and reliability, just like a relational database.

A few examples of Data Warehouses are Redshift, Snowflake, BigQuery, etc.

What is AWS Redshift?

Amazon Redshift is a petabyte-scale Data Warehouse solution that makes it simple and cost-effective to analyze all of your data using built-in analytics tools. It is meant to cost less than a tenth of the cost of most standard data warehousing systems and is primarily focused on data volumes varying from a few hundred gigabytes to a petabyte or more.

Amazon Redshift uses columnar storage technology to enable rapid query and I/O performance for nearly any scale dataset, while also parallelizing and spreading queries over numerous nodes. It automates the majority of the administrative work connected with providing, setting, monitoring, backing up, and protecting a Data Warehouse, making it simple and economical to operate. Because of this automation, you can create multi-petabyte Data Warehouses in minutes rather than weeks or months. Without any loading or ETL, Amazon Redshift Spectrum allows you to conduct queries across exabytes of unstructured data in Amazon S3. When you send a query to Amazon Redshift SQL, it builds and optimizes a query plan.

Amazon Redshift identifies what data is local and what data is in S3, creates a strategy to reduce the amount of S3 data that must be read, and then requests Redshift Spectrum workers from a shared resource pool to read and process the S3 data. You may query and interpret data between operational databases, Data Warehouses, and data lakes using Amazon Redshift’s federated query functionality.

It also allows you to combine Amazon Redshift searches on live data from other databases using queries from across your Amazon Redshift and S3 environments. You may query data from every database in the Amazon Redshift cluster utilizing cross-database queries, irrespective of which database you are connected to.

Key Features of Amazon Redshift

  • Redshift allows users to write queries and export the data back to Data Lake.
  • Redshift can seamlessly query the files like CSV, Avro, Parquet, JSON, and ORC directly with the help of ANSI SQL.
  • Redshift has exceptional support for Machine Learning, and developers can create, train and deploy Amazon Sagemaker models using SQL.
  • Redshift has an Advanced Query Accelerator (AQUA) which performs the query 10x faster than other cloud Data Warehouses.
  • Redshift’s Materialistic view allows you to achieve faster query performance for ETL, batch job processing, and dashboarding.
  • Redshift has a petabyte scalable architecture, and it scales quickly as per need.
  • Redshift enables secure sharing of the data across Redshift clusters.
  • Even when thousands of queries are running at the same time, Amazon Redshift delivers consistently fast results.

Benefits Of Amazon Redshift

  • Speed: With the use of MPP technology, the speed of outputting large amounts of data is unprecedented. The cost AWS provides for services is unmatched by other cloud service providers.
  • Data Encryption:  Amazon provides data encryption for all parts of your Redshift operation. The user can decide which processes need to be encrypted and which ones do not. Data encryption provides an additional layer of security. 
  • Familiarity: Redshift is based on PostgreSQL. All  SQL queries work with it. In addition, you can choose the SQL, ETL (extract, transform, load), and business intelligence (BI) tools you are familiar with. You are not obligated to use the tools provided by Amazon.
  • Smart Optimization: If your dataset is large, there are several ways to query the data with the same parameters. Different commands have different levels of data usage. AWS Redshift provides tools and information to improve your queries. These can be used for faster and more resource-efficient operations. 
  • Automate Repetitive Tasks: Redshift can automate tasks that need to be repeated. This can be an administrative task such as creating daily, weekly, or monthly reports. This can be a resource and cost review. It can also be a regular maintenance task to clean up your data. You can automate all of this using the actions provided by Redshift. 
  • Simultaneous Scaling: AWS Redshift automatically scales up to support the growth of concurrent workloads.
  • Query Volume: MPP technology shines in this regard. You can send thousands of queries to your dataset at any time. Still, Redshift is never slowing down. Dynamically allocate processing and memory resources to handle increasing demand.  
  • AWS Integration: Redshift works well with other AWS tools. You can set up integrations between all services, depending on your needs and optimal configuration.
  • Redshift API: Redshift has a robust API with extensive documentation. It can be used to send queries and get results using API tools. The API can also be used in Python programs to facilitate coding. 
  • Safety: Cloud security is handled by Amazon, and application security in the cloud must be provided by the user. Amazon offers access control, data encryption, and virtual private clouds to provide an additional level of security.  
  • Machine Learning: machine-learning concepts are used by Redshift to predict and analyze queries. In addition to MPP, this makes  Redshift perform faster than any other solution on the market.  
  • Easy Deployment: Redshift clusters can be deployed anywhere in the world from anywhere in minutes. In minutes, you’ll have a powerful data warehousing solution at a fraction of the price of your competitors.
  • Consistent Backup: Amazon automatically backs up your data regularly. It can be used for recovery in the event of an error, failure, or damage. Backups are distributed in different locations. This eliminates the risk of confusion on your site.
  • AWS Analytics: AWS offers many analytical tools. All of this works well with Redshift. Amazon provides support for integrating other analytics tools with Redshift. Redshift being the child of the AWS community has native integration capabilities with AWS analytics services.  
  • Open Format: Redshift can support and provide output in many open formats of data. The most commonly supported formats are Apache Parquet and Optimized Row Columnar (ORC) file formats.
  • Partner Ecosystem: AWS is one of the first cloud service providers that started the market of Cloud Data Warehouses. Many customers rely on Amazon for their infrastructure. In addition, AWS has a strong network of partners to build third-party applications and provide implementation services. You can also leverage this partner ecosystem to see if you can find the best implementation solution for your organization.

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Creating Redshift VPC

Creating Redshift VPC: Prerequisites for Creating a Redshift VPC Cluster

After getting enough knowledge about Data Warehouses and Redshift you can now proceed to the first step of setting up the Redshift VPC cluster. Those are creating Security Group and AM Policies & Roles. According to the AWS documentation, An AWS security group acts as a virtual firewall for your EC2 instances to control incoming and outgoing traffic. The flow of traffic to and from your instance is controlled by inbound and outbound rules, respectively. Follow the steps below to create a Security Group:

  • Step 1: To create a Security Group, you need to search for security groups in the search bar in the AWS console:
redshift vpc: Prerequisites of creating redshift vpc 1
Image Source: Self
  • Step 2: Click on the EC2 service. Amazon EC2 stands for Amazon Elastic Compute Cloud in full. Because Amazon EC2 is one of the most popular and fundamental services, it’s a good idea to start with it if you’re new to AWS. To put it simply, EC2 is a computer with your selection of operating systems and physical components. But there’s a distinction: it’s completely virtualized. Multiple virtual computers can be run on a single piece of physical hardware.
  • Step 3: After clicking EC2 you will see Security Groups under Network & Security. Then you create a new security group with the optional name and descriptions. Just remember to grant Redshift access to the default port 5439.
redshift vpc: Prerequisites of creating redshift vpc 2
Image Source: Self
  • Step 4: Next, you will create an IAM policy for accessing S3 buckets from Redshift.
redshift vpc: Prerequisites of creating redshift vpc 3
Image Source: Self
  • Step 5: For assigning policy you need to create an IAM role as well. Then you will give attach this redshift policy to the role:
redshift vpc: Prerequisites of creating redshift vpc 4
Image Source: Self
  • Step 6: Don’t forget to check your trust relationship as well(it should be similar):
  "Version": "2012-10-17",
  "Statement": [
      "Sid": "",
      "Effect": "Allow",
      "Principal": {
        "Service": ""
      "Action": "sts:AssumeRole"
  • Step 7: For configuring the subnet group for Redshift you need to create a VPC.You just need to search for Redshift VPC in the search bar and then create one with default properties.
redshift vpc: Prerequisites of creating redshift vpc 5
Image Source: Self
  • Step 8: As you got the Redshift VPC now you can create a subnet group by selecting this Redshift VPC and some other parameters like name, description, and availability zones. 

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Creating Redshift VPC: Setting Up Redshift VPC Cluster

Finally, you have come to the part that excites most of you. I know it must be tough to set all the prerequisites but it is essential to avoid errors. I don’t want to put you on hold so let’s proceed to the Redshift VPC Cluster page and create a cluster.  Here you can check different node types depending on the storage capacity and CPU count. Follow the steps below for setting up Redshift VPC Cluster:

  • Step 1:For the demo, you will use dc2.large as it is the smallest one. You can also increase the number of nodes but you will take it as 2.
redshift vpc: setting up redshift vpc 1
Image Source: Self

For accessing a database you also need to set a username and password.

  • Step 2: Select the prerequisites that you created before(IAM role, subnet group, Redshift VPC).
  • Step 3: Last but not least you need to specify how long you want to retain your snapshot. So Snapshots are point-in-time backups of a cluster. These snapshots are saved in Amazon S3 by Amazon Redshift internally. You will go by default for 1 day. It’s time for your hard work to pay off, so click the mysterious create cluster button. You can check your cluster in the clusters dashboard after a few minutes.
redshift vpc: setting up redshift vpc 2
Image Source: Self


Amazon Redshift is suitable for integrating your existing business intelligence tools for online analytical processing (OLAP). Redshift strikes a decent balance between the capacity to store a large amount of data and the ability to query it quickly and easily. This article talks about setting up the Redshift VPC Cluster and the steps involved in the creation of the Redshift VPC Cluster.

As you collect and manage your data across several applications and databases in your business, it is important to consolidate it for a complete performance analysis of your business. However, it is a time-consuming and resource-intensive task to continuously monitor the Data Connectors. To achieve this efficiently, you need to assign a portion of your engineering bandwidth to Integrate data from all sources, Clean & Transform it, and finally, Load it to a Cloud Data Warehouse like Amazon Redshift, or a destination of your choice for further Business Analytics. All of these challenges can be comfortably solved by a Cloud-based ETL tool such as Hevo Data.   

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