diff --git a/infra/azure-peerpods/main.tf b/infra/azure-peerpods/main.tf
index f8611ad835..cafda48249 100644
--- a/infra/azure-peerpods/main.tf
+++ b/infra/azure-peerpods/main.tf
@@ -101,6 +101,7 @@ resource "azurerm_kubernetes_cluster" "cluster" {
   dns_prefix                = "aks"
   oidc_issuer_enabled       = true
   workload_identity_enabled = true
+  sku_tier                  = var.cluster_type
 
   identity {
     type = "SystemAssigned"
diff --git a/infra/azure-peerpods/vars.tf b/infra/azure-peerpods/vars.tf
index 3a8e503c46..681ba87c4d 100644
--- a/infra/azure-peerpods/vars.tf
+++ b/infra/azure-peerpods/vars.tf
@@ -13,3 +13,8 @@ variable "subscription_id" {
 variable "image_id" {
   type = string
 }
+
+variable "cluster_type" {
+  type = string
+  default = "Free"
+}