| name | licensing |
| description | Power Platform licensing and cost optimization. Use when: license types, per user, per app, pay-as-you-go, premium, Copilot Studio licensing, Power Automate licensing, AI Builder credits, Copilot Credits, Managed Environments licensing, capacity, API request limits, cost optimization, feature-to-license mapping. |
Skill: Power Platform Licensing
When to Use
Trigger when determining license requirements for a solution, mapping features to license tiers, planning capacity, evaluating cost models, or troubleshooting license enforcement errors.
License Types at a Glance
Power Apps
| License | Price (USD) | Scope | Key Entitlements |
|---|
| Power Apps Premium | $20/user/month ($12 at 2000+ users) | Per user | Unlimited custom apps, unlimited Power Pages websites, premium connectors, Dataverse, Managed Environments |
| Power Apps per app | $5/user/app/month | Per user per app | One app OR one Power Pages website per license, stackable |
| Pay-as-you-go | $10/active user/app/month | Per app via Azure | No upfront commitment, billed to Azure subscription |
| Developer Plan | Free | Per user (individual) | Full premium features, single-user developer environment, no sharing |
| M365 seeded | Included with M365 | Per user | Standard connectors only, no premium, no Dataverse (except default env) |
Power Automate
| License | Price (USD) | Scope | Key Entitlements |
|---|
| Power Automate Premium | $15/user/month | Per user | Unlimited cloud flows, attended RPA, premium connectors, process mining (50MB data), AI Builder credits (until Nov 2026) |
| Power Automate Process | $150/bot/month | Per automation | Unattended RPA, unlimited users for the process, one machine session |
| Power Automate Hosted Process | $215/bot/month | Per automation | Process license + hosted machine capacity |
| Pay-as-you-go | $0.60/cloud flow run, $3.00/desktop flow run | Per run via Azure | Premium cloud and desktop flows, billed to Azure |
| M365 seeded | Included with M365 | Per user | Standard connectors only, no premium, no RPA |
Copilot Studio
| License | Price (USD) | Scope | Key Entitlements |
|---|
| Copilot Studio | Per tenant (check current pricing) | Tenant | 25,000 Copilot Credits/month, standard + premium + custom connectors, Dataverse (5GB DB, 20GB file, 2GB log) |
| Copilot Credits prepaid pack | Per pack | Tenant/environment | Additional Copilot Credits capacity |
| Pay-as-you-go | Per Copilot Credit via Azure | Per use | No upfront commitment, billed monthly |
Sept 2025 change: Copilot Studio billing currency changed from "messages" to "Copilot Credits." No change in quantity per prepaid pack or pay-as-you-go rate.
Copilot Credit Consumption Rates
| Action | Credits Consumed |
|---|
| Regular (non-generative AI) response | 1 credit |
| Generative AI answer (over your data) | 2 credits |
| AI Builder action (in agent/agent flow context) | Varies by action type |
Power Pages
| License | Scope | Key Entitlements |
|---|
| Per website | Per site | Authenticated user capacity (bundled) |
| Authenticated users | Per user/site/month | Access to authenticated areas |
| Anonymous users | Per user/site/month | Access to public pages |
| Pay-as-you-go | Via Azure | Per authenticated/anonymous user |
Power Pages is also accessible via Power Apps Premium (unlimited websites).
Feature-to-License Mapping
What Requires Premium?
| Feature | License Required | Why |
|---|
| Custom connectors | Premium (Power Apps or Power Automate) | Not included in M365 seeded |
| Premium connectors (SQL, HTTP with Entra, etc.) | Premium | Not included in M365 seeded |
| On-premises data gateway | Premium | Gateway connections are premium |
| Dataverse (beyond default env) | Premium | Dataverse requires premium or Dynamics license |
| Code Apps | Premium | Code Apps = custom app = premium |
| Elastic tables | Premium + capacity | Additional capacity charges apply |
| Managed Environments (runtime) | Premium or Dynamics | Not included in Developer Plan or M365 |
| AI Builder | Premium + Copilot Credits or AI Builder credits | Credits consumed per use |
| Desktop flows (RPA) | Power Automate Premium (attended) or Process (unattended) | Separate from cloud flow licensing |
| Process Mining | Power Automate Premium | 50MB data per user license |
What's Included in M365?
| Included | NOT Included |
|---|
| Standard connectors (SharePoint, Outlook, Teams, Excel, etc.) | Premium connectors |
| Canvas apps using standard connectors | Custom connectors |
| Cloud flows using standard connectors | On-premises data gateway |
| Power Apps in Teams (Dataverse for Teams) | Dataverse (full, outside Teams) |
| Up to 6,000 API requests/day | Additional API capacity |
Dynamics 365 Seeded Rights
Users with Dynamics 365 Enterprise licenses get seeded Power Apps and Power Automate rights:
- Power Apps usage within the context of the Dynamics 365 application
- Power Automate usage within the context of Dynamics 365
- Premium connector access (within Dynamics context)
- Dataverse access (within the Dynamics 365 environment)
- Managed Environment entitlement
Important: Seeded rights are "within context" — building standalone apps/flows unrelated to the D365 application may require separate licensing.
Capacity
Dataverse Storage Capacity
| Type | Description | Included Per Tenant |
|---|
| Database | Row data, metadata | Varies by license count |
| File | Attachments, images, notes | Varies by license count |
| Log | Audit logs, activity logs | Varies by license count |
Check capacity: Power Platform Admin Center → Resources → Capacity
API Request Limits
| License | Daily Limit (per user/flow) |
|---|
| Power Apps Premium / Power Automate Premium | 40,000 requests/day |
| Power Automate Process | 250,000 requests/day |
| M365 seeded | 6,000 requests/day |
| Dynamics 365 Enterprise | 20,000 requests/day |
| Pay-as-you-go (per app) | 6,000 requests/user/app/day |
Protection limits: Separate from entitlement limits. If a user/flow exceeds protection limits (e.g., 6,000 requests per 5-minute window), requests are throttled with HTTP 429 responses. Use Retry-After header.
API Request Overage
With pay-as-you-go enabled, requests above the daily entitlement are billed to Azure:
Overage rate: $0.00004 per request (illustrative — check current pricing)
Example:
User with 40,000/day entitlement uses 50,000 in a day
Overage: 10,000 requests × $0.00004 = $0.40
AI Builder / Copilot Credits
Current State (2025-2026 Transition)
| Timeline | What Happens |
|---|
| Now | AI Builder features in Power Apps/Automate consume AI Builder credits first, then Copilot Credits |
| Nov 2025 | New customers cannot purchase AI Builder add-ons — must buy Copilot Credits |
| Nov 2026 | Seeded AI Builder credits (from Premium licenses) removed for ALL customers |
| Ongoing | Agents and agent flows always consume Copilot Credits (never AI Builder credits) |
Credit Sources
| Source | Credits | Notes |
|---|
| Power Apps Premium (seeded) | 5,000 AI Builder credits/user/month | Removed Nov 2026 |
| Power Automate Premium (seeded) | 5,000 AI Builder credits/user/month | Removed Nov 2026 |
| AI Builder add-on | 1,000,000 credits/add-on/month | Renewal only (existing customers) |
| Copilot Credits prepaid pack | Per pack | New currency for all AI features |
| Pay-as-you-go | Per use via Azure | No upfront commitment |
Monitoring AI/Copilot Credit Usage
Power Platform Admin Center → Resources → Capacity
→ AI Builder credits tab (shows consumption per environment)
→ Copilot Credits tab (shows consumption per environment)
Cost Optimization Patterns
Pattern 1: Start with Pay-as-you-go
New app, uncertain adoption → Enable pay-as-you-go
→ Monitor usage for 3 months
→ If consistent usage: switch to per-user licenses (cheaper at scale)
→ If sporadic usage: keep pay-as-you-go (cheaper for low volume)
Break-even analysis:
Pay-as-you-go: $10/active user/app/month
Per-user: $20/user/month (unlimited apps)
Break-even: 2 apps per user
- User uses 1 app → pay-as-you-go cheaper ($10 vs $20)
- User uses 3 apps → per-user cheaper ($20 vs $30)
Pattern 2: Per-App for Targeted Deployment
Specific app used by a large group of occasional users
→ Per-app license ($5/user/app/month)
→ Cheaper than per-user if users only need one app
→ Stackable: user can have multiple per-app licenses
Pattern 3: Process License for Shared Automations
Critical business process (e.g., invoice processing)
→ One Process license ($150/month) covers:
- The main flow
- All child flows
- All associated flows in the same solution
- Unlimited users
→ Much cheaper than licensing every user who benefits
Pattern 4: License Auto-Claim
Power Platform Admin Center → Settings → License auto-claim
→ Enable auto-claim for Power Apps
→ When a user opens an app requiring Premium, a license is auto-assigned
→ Prevents over-provisioning (only users who actually use get licenses)
Pattern 5: Monitor Before Buying
1. Deploy CoE Starter Kit for inventory visibility
2. Identify which apps use premium features
3. Identify how many users actively use each app
4. Map to optimal license mix (per-user vs per-app vs pay-as-you-go)
5. Purchase based on actual usage, not estimates
Common Gotchas
| Gotcha | Impact | Prevention |
|---|
| Code Apps = Premium | Every user of a Code App needs Premium or per-app license | Confirm licensing before building Code Apps for broad audiences |
| Custom connectors = Premium | Any app using a custom connector requires Premium | Document connector requirements in spec phase |
| On-prem gateway = Premium | Gateway connections require Premium licensing | Plan for Premium if using on-premises data |
| Elastic tables = Premium + capacity | Elastic tables need Premium AND consume extra storage capacity | Evaluate storage cost before choosing elastic tables |
| AI Builder credits disappearing | Seeded credits removed Nov 2026 — plan for Copilot Credits | Budget for Copilot Credits or pay-as-you-go for AI features |
| API request limits | Exceeded limits = throttled (429 errors) | Monitor via Admin Center, buy capacity add-ons if needed |
| Pay-as-you-go without monitoring | Unexpected Azure bills | Set Azure cost alerts, review monthly |
| M365 users hitting premium features | App fails at runtime with licensing error | Test with M365-only user before deploying |
| Process license per environment | Process license covers one environment only | Budget for Process license per environment (dev/test/prod) |
| Managed Environments without Premium | Developer Plan doesn't entitle Managed Env at runtime | Ensure production users have Premium or Dynamics licenses |
License Enforcement Errors
| Error | Cause | Resolution |
|---|
| "This app requires a Power Apps Premium license" | User lacks Premium or per-app license | Assign license or enable pay-as-you-go |
| "EntitlementNotAvailable" (AI Builder) | No AI Builder or Copilot Credits in environment | Allocate credits or enable pay-as-you-go |
| "QuotaExceeded" (API requests) | User/flow exceeded daily API request limit | Wait until next day or purchase capacity add-on |
| HTTP 429 (Too Many Requests) | Protection limit exceeded (6,000 req/5 min) | Implement retry with Retry-After header |
| "Flow needs a Premium license" | Flow uses premium connector without license | Assign Premium license to flow owner or Process license to flow |
| "You need a license to use this feature" | Managed Environment feature without entitlement | Assign Premium, Dynamics, or appropriate license |
License Decision Tree
Does the app/flow use premium connectors, custom connectors, or Dataverse?
├── No → M365 seeded license is sufficient
└── Yes → How many users?
├── < 10 users → Per-app ($5/user/app)
├── 10-50 users using 1-2 apps → Per-app ($5/user/app)
├── 50+ users or 3+ apps per user → Per-user Premium ($20/user)
└── Uncertain adoption → Pay-as-you-go ($10/active user/app)
Does the flow run unattended RPA?
├── No → Power Automate Premium ($15/user) for the flow owner
└── Yes → Power Automate Process ($150/bot) per machine session
Does the solution use AI Builder or Copilot Studio?
├── Light usage → Seeded credits (until Nov 2026) or pay-as-you-go
├── Moderate usage → Copilot Credits prepaid pack
└── Heavy usage → Copilot Credits prepaid pack + pay-as-you-go overflow
Anti-Patterns
- Building with premium features without confirming licenses — app works in dev (developer has Premium), fails for end users (who don't)
- Ignoring API request limits — designing high-throughput integrations without checking protection limits
- Using pay-as-you-go without Azure cost alerts — runaway costs from unexpected usage spikes
- Over-licensing — buying per-user Premium for 500 users when only 50 use premium features (use per-app instead)
- Under-licensing — not licensing flow owners, causing silent flow failures
- Assuming M365 includes everything — M365 only covers standard connectors; premium features require separate licensing
- Ignoring the AI Builder credit sunset — planning for AI features without budgeting for Copilot Credits post-Nov 2026
- Not using license auto-claim — manually assigning licenses instead of letting the platform assign on first use
- Testing only with admin accounts — admins have full licenses; test with representative end-user licenses
- No cost monitoring — deploying solutions without tracking license consumption or API usage
Related Skills
env-strategy — Managed Environments licensing requirementsgovernance — License compliance monitoring via CoE Starter Kitarchitecture — License implications of architecture decisionscode-apps — Code Apps require Premium licensingcopilot-studio — Copilot Studio licensing and Copilot Credits
