Copilot Credits & cost management
Copilot Credits, clearly explained
Copilot Credits are the usage unit Microsoft uses to bill agentic work in Copilot, on top of the user licence. We help you forecast, cap and account for what that usage delivers — without surprises afterwards.
The model
Two layers: licence and usage
The Microsoft 365 Copilot licence covers everyday AI work: Copilot Chat, Copilot in Word, Excel, PowerPoint, Outlook and Teams, the choice between models and automatic routing (“Auto”). For most employees that is enough to save time every day.
On top of that comes usage-based billing in Copilot Credits. It applies to agentic work — tasks Copilot carries out independently in multiple steps — such as Cowork, Code, Autopilot, frontier models and new agentic features in SharePoint. Usage always requires a licence. Microsoft announced this model in September 2026; the rollout runs from October through December 2026.
2 layers
A licence for everyday work, Copilot Credits for agentic work.
Usage services
What consumes Copilot Credits?
In the Microsoft 365 admin center, the usage services are listed under Copilot → Cost management. These are the main ones — Microsoft is extending the list in phases.
Copilot Cowork
Cowork carries out multi-step tasks for you, including in the background. It is generally available and always runs on usage — a lower effort level uses fewer credits.
Copilot Code & Copilot Managed Runtime
With Copilot Code, non-developers build widgets, dashboards and internal apps in plain language, currently through the Frontier programme. The Copilot Managed Runtime (in preview) is also one of the usage services.
Autopilot
A persistent cloud agent with its own name, role and memory that follows up on channels and threads. Autopilot (formerly Scout) is in private preview and billed in Copilot Credits.
Frontier models
The heaviest, newest models in Cowork sit outside the licence. You choose per group which model families are available.
SharePoint (advanced) & Teams Phone agent
Copilot in SharePoint and OneDrive is part of the licence, but bulk work such as auto-filling file properties runs on usage. The same goes for the Teams Phone agent, the AI receptionist for Teams Phone.
Copilot Studio on the GitHub Copilot harness
A harness is the runtime an agent runs on. Agents on the GitHub Copilot harness, computer use and development environments consume credits — from the very first test.
Overview
What falls under the licence, what under usage?
The line is not drawn per app, but per type of work. Use this overview as a starting point and check the details per tenant: Microsoft is shifting components in phases.
| Component | User licence | Usage (Copilot Credits) |
|---|---|---|
| Copilot Chat and Copilot in Word, Excel, PowerPoint, Outlook and Teams | ✓ | — |
| Model choice and automatic routing (Auto) | ✓ | — |
| Researcher and Analyst | ✓ | — |
| Agents on the standard harness, for licensed users in Microsoft 365 | ✓ | — |
| Copilot Cowork | — | ✓ |
| Copilot Code and Autopilot | — | ✓ |
| Frontier models | — | ✓ |
| Agents on the GitHub Copilot harness and computer use, including while building and testing | — | ✓ |
| SharePoint agents and agents for Copilot Chat users | — | Separate path: Copilot pay-as-you-go |
Copilot Expert does not sell licences and does not list rates. What it means for you, we work out in a personal conversation.
Cost management
The cost-management controls
Usage can be steered — if you know the controls and set them before the first agent goes live.
Spending policies
A spending policy determines who may use which usage services and up to what limit — per user, per group or for the whole organisation. Requests for extra credits can be routed to an approver.
Limits and alerts per agent
In Copilot Studio you allocate capacity per environment and set a limit per agent with an alert or a hard stop ("Stop usage"). Azure budgets only send a warning; they do not stop anything.
Automatically adding new services
The "Auto-apply new services" setting is on by default: new usage services then fall straight under your existing policies. Make that choice deliberately if you want to review every new service yourself first.
Model families per group
Not everyone needs the heaviest model. Decide per group which model families are available, so expensive models end up where they deliver something.
Consumption Dashboard and /cost
The Consumption Dashboard shows credit usage against budget, with access for managers, analysts and admins. In Cowork, the /cost command shows what a task consumes.
Payment options
You choose between pay-as-you-go, prepaid capacity or a pre-purchase plan. Which one fits depends on how predictable your volumes are.
Our conviction
Usage is not a surprise, it is a choice.
How we work
Our approach: FinOps for Copilot
FinOps is financial management of cloud services: making usage visible, capping it and accounting for it. We apply it to Copilot, in four steps.
- 1
Inventory
Which use cases need agentic work, and at what volumes? We map it out per team.
- 2
Estimate
Per use case we estimate the usage and set it against the expected time saved.
- 3
Cap
Spending policies, limits per agent and alerts — in place before the first task runs.
- 4
Measure & adjust
Every month we put the usage and Agent 365 dashboards next to the benefits, and adjust the controls.
SMB
SMB: watch out with Copilot Business
Copilot Business is the Microsoft 365 Copilot variant for organisations with up to 300 users. Microsoft has announced that new Copilot Business subscriptions will have usage on by default for agentic features such as Cowork: from 19 October 2026 for direct purchases and from 2 November 2026 through a CSP partner. According to Microsoft, existing subscriptions and policies stay unchanged.
Our advice: create a spending policy before the first Cowork task. Then you decide who uses credits and up to what limit, rather than the default setting. Check it per tenant — especially if your subscription was taken out around those dates.
Spending policy first
Decide who may use Cowork and other usage services, before the first task.
Limit and alert
Pick a monthly cap with a warning, so you never get a surprise afterwards.
One owner
Someone who follows the dashboard and decides on expansion — often the IT partner or controller.
FAQ
Frequently asked questions
On Copilot Credits, usage-based billing and cost management.
What are Copilot Credits?
Copilot Credits are the usage unit Microsoft uses to bill agentic work in Copilot, on top of the user licence. Think of Cowork, Code, Autopilot, the heaviest models and agents on the GitHub Copilot harness. Admins cap usage with spending policies and limits.
Do I still need a Copilot licence if I work with credits?
Yes. Usage in Copilot Credits comes on top of the Microsoft 365 Copilot licence and does not replace it. Only a few components, such as SharePoint agents for Copilot Chat users, run through a separate pay-as-you-go path.
Which features consume Copilot Credits?
Among others Copilot Cowork, Copilot Code, Autopilot, frontier models, advanced work in SharePoint and OneDrive, the Teams Phone agent, the Work IQ API (which lets agents use work context) and agents on the GitHub Copilot harness in Copilot Studio. Microsoft is extending that list in phases; we keep track of it for you.
Does building and testing in Copilot Studio also cost credits?
On the GitHub Copilot harness it does: there you consume credits from the first build, test or evaluation run, and the Copilot licence never covers that. On the standard harness, agents for licensed users in Microsoft 365 are covered by the licence. Development and trial environments have run on usage since September 2026, so plan them with their own limit.
How do I prevent unexpected costs?
With spending policies per department or group, limits and alerts per agent, and a fixed monthly usage review. Also check the setting that automatically adds new services to existing policies: it is on by default. Turn it off if you want to review every new service first.
Is usage-based billing on by default?
It varies. For larger organisations, according to analysts, it stays off until an admin creates a spending policy. Microsoft has announced that it will be on by default for new Copilot Business subscriptions from late October 2026. So check it per tenant.
What does a Copilot Credit cost?
That depends on the payment option and changes regularly, so we do not list rates here. In a personal conversation we work it out for your use cases and licence mix.
Want control over your Copilot usage?
In an advisory call we estimate usage per use case and set the cost controls right — before the first invoice.