Use case:
I have a $10/month VPS and one of my blog posts gets posted to Hacker News and Slashdot. My server sees a huge spike in traffic. This is okay because Digital Ocean has automatic resource scaling and they will bump me to a higher plan (with more ram, cpu, etc) for as long as my server needs the extra resources to handle the requests. When my blog post dies down, I return to my $10/month plan and I get charged based on the amount of hours I needed to use the larger plan.