Ultimate Guide to Mastering Power BI Licensing for Enterprises

Power BI Desktop is free: So why do you need to pay?

Of all the questions we answer as Power BI implementation experts, the most asked one is that why should we upgrade if Power BI desktop is free? While it is true that creating reports is free with Power BI Desktop (Now Microsoft Fabric free account), Microsoft charges for:

- Publishing and sharing reports with other users

- Better Infrastructure wrt data model sizes, capacity, refresh rates, and access to workspaces

- Integration and access to other applications like AI,ML, data marts, real-time analytics

- Access to One Lake storage, networking, One Lake cache, and more..

So, if you want to leverage Power BI beyond personal use i.e. create dashboards for larger datasets, use their robust tools, and share it with others, then you might have to choose between Power BI Pro, Power BI Premium, Power BI Embedded or Microsoft Fabric SKUs (which has Power BI included in it).

A quick note on details about Power BI license types and pricing (and Fabric of course )terminology: we'll be using terms like capacity, storage, refresh rates, and SKUs throughout this guide. Already familiar? Skip ahead.

What are the key concepts to understand Power BI license cost and pricing?

After the addition of Microsoft Fabric SKU, there are now 4 types of SKUs, you might come across while dealing with Power BI namely: A, P, F, and EM types. You might need to select an SKU based on the type of you Power BI solution you want deployed out of Power BI Pro, Power BI Premium, Power BI Embedded or Microsoft Fabric.

Please note: Power BI EM SKUs (EM1, EM2, EM3) are capacity-based licenses under Power BI Premium. These have been designed specifically for embedding Power BI content into Microsoft 365 apps like SharePoint, Teams, and PowerPoint (embedding with user-owned data). They are more closely tied with Microsoft 365 integrations – so we’re not going too much into it.

For the sake of simplicity below is a brief overview between them.

*For F type F64 and above has Power BI

Note: As per Microsoft’s official announcement, Power BI Premium per capacity (P-type) SKUs have been officially retired as of July 1 2024 for new customers, with complete transition required by January 1 2025. These have been replaced by Microsoft Fabric (F-type) capacities — which unify analytics across Power BI, Azure Synapse, and Azure Data Factory.

To share and collaborate on Microsoft Fabric, you’ll need at least one F64 capacity license and a per-user license.

We’ll revisit Microsoft Fabric and migration details later in this guide.

Now, back to Power BI.

What are the key concepts to understand Power BI license cost and pricing?

Now that you understand the SKU types, let's break down the actual Power BI license types available in 2025.

We've established the fact that Power BI charges you for its capacity and shareability. So, the licenses, including Power BI license types and cost, are:

• User-based – paid as per the number of users
• Capacity-based – paid as per the capacity nodes needed

Based on user and capacity, the types of Power BI licenses can be listed as:

In addition to this, there is also Microsoft fabric, which along with the pricing of these types we’ll talk a little bit later, so bear with us till then.

What’s your Power BI driver?

Based on our experience, this is how we see most users get started with Power BI. Each of these scenarios has a different driver and cause — and understanding which applies to you helps in selecting the right types of Power BI license and managing your Power BI license cost effectively.

Baseline: Scenario Zero

Melanie, an Inventory analyst, creates a comprehensive inventory report using the free Power BI Desktop.

- The report provided valuable insights into the demand and helps identify potential stockouts.

- Though they were able to create visually rich dashboards, they couldn’t share them with their team members.

- The only way to view reports with Power BI Free is with a premium workspace or application.

- Though they were able to create visually rich dashboards, they couldn’t share them with their team members.

- The only way to view reports with Power BI Free is with a premium workspace or application.

- To overcome this limitation, they decided to take advantage of the Power BI Pro trial license for 30 days, which allowed them to share dashboards seamlessly within the team.

Outcome achieved with Power BI Free: The ability to create dashboards with existing data and generate insights.

Scenario 1: Power BI Pro

• Now, Melanie’s team shared the report to the Sales heads for EMEA markets: Daniel, Taylor, Emma, and Michael.
• They loved the reports and wanted to share their insights with their sales team, which comprised of 10 people each.
• So they’ve acquired the Power BI Pro license at a cost of $14 per user/month (updated April 2025) each and have started creating their own dashboards for Sales as well.
• Melanie and Micheal now want to create applications for their data, but the data storage capacity is limiting their analytics capabilities, and they are also unable see their huge historical data available.

Now their bottom line is the cost driver of adding more users while expanding their storage.

With Power BI Pro, you get shared datasets, Excel integration for ad-hoc analysis, 1 GB dataset limit, 8 refreshes per day, and 10 GB storage per user.

The catch? Power BI Pro cost scales with headcount. More users = higher monthly bill

Key takeaway: The cost of Power BI Pro scales linearly with the number of users. As collaboration grows, so does your per-user licensing cost.

Outcome achieved with Power BI Pro: You can share certified datasets, perform ad-hoc analysis within Excel, access to 1 GB semantic models, 8 report refreshes per day, and maximum storage of 10 GB/user.

Scenario 2: Power BI Premium License per user

• The data set that Melanie and Micheal have started using is now more than 1GB.
• They’ve decided to shift to Power BI Premium per user (PPU) licensing where they can access 100 GB model memory and 48 refreshes/day and advanced features like scorecards, deployment pipelines, and XMLA endpoint read/write. All for $24 per user/month
• This enabled them to gain access to additional features like scorecards and deployment pipelines.

Please note: that Power BI Premium per user is Workspace-specific and can’t be mixed with other Power BI license types in the same workspace. It is also advisable at this stage to understand why you have large model sizes (it might be because you lack effective data warehousing capabilities). Buying more storage might not help if you have poor performing reports or scattered data.

Now their bottom line is the try to embed higher data-volume of reports within their applications.

Outcome achieved with Power BI Premium per user: You can create reports for larger datasets with maximum storage of 100 TB, at a higher refresh rate (from 8 to 48/day) and with Advanced AI, dataflows, datamarts, and XMLA endpoint read/write which is useful for DevOps approaches.

At $24/user, the Power BI Premium license cost is justified when users need advanced analytics and larger data models.

Scenario 3: Scenario 3: Power BI Premium per capacity (Transitioned to Microsoft Fabric)

Melanie and Michael's needs have grown significantly. They now have larger datasets and want to share reports with 350 people across the organization.

The cost comparison:

• Power BI Premium per user (PPU): 350 × $24 = $8,400/month
• Capacity-based model (Fabric F-type): More cost-effective at this scale

Here’s where the Power BI licensing options get interesting.

Previously, organizations used Power BI Premium per capacity (P1 SKU) starting at $4,995/month. However, Microsoft retired P-type SKUs in July 2024 for new purchases, with existing customers required to transition to Fabric capacities by January 2025.

The replacement: Microsoft Fabric (F-type) capacities

Microsoft Fabric (F-type) capacities now replace Power BI Premium per capacity, offering:

✓ All Power BI Premium capabilities retained

✓ Unified analytics across Power BI, Azure Synapse, and Azure Data Factory

✓ Flexible licensing billed by capacity units (CUs) and v-cores

✓ Starting at F64 SKU (~$5,003/month) for Power BI consumption by Free users

✓ Access to unified workloads – Data Engineering, Data Warehousing, Data Science, Real-Time Analytics

✓ Integration with OneLake storage, BCDR, caching, and networking

✓ Maximum dataset storage: 400 TB ✓ Report refreshes: 48/day

For Melanie and Michael’s scenario with 350 users, Fabric F64 (~$5,003 / month) is around 40 % more cost-effective than individual PPU licenses — and it allows Free users (with Viewer role) to consume Power BI content without additional licenses.

Understanding capacity planning for Fabric

One complexity of capacity-based models is computing your capacity needs. Parameters to consider:

- Data volume

- User workload (concurrent users)

- Quantity and complexity of reports

- Power Query transformations

- Calculation complexity within reports

- Desired performance and acceptable latency

- Infrastructure type (on-premises vs. cloud-based)

- Report interactivity requirements

Based on your selected SKU, you receive dedicated Capacity Units (CUs) and v-cores, which determine your compute power and concurrency limits.

Capacity Units (CUs): Dedicated resources that govern how many workloads can run simultaneously. More CUs = larger data models, more refreshes, and better concurrency.

v-cores: Virtual cores represent the front-end and back-end compute resources assigned to your capacity. Administrators can monitor and scale them as needed.

Here is a snapshot of the CU and Power BI v-cores assigned based on Fabric and Power BI SKUs.

Computing power between F & Power BI SKUs

The difference in capacity units and v-cores across Power BI SKUs represents differences in computational throughput, not pricing. After the introduction of Fabric, Microsoft officially began retiring the Power BI Premium per capacity (P-type) SKUs to consolidate into F-series Fabric capacities.

Everything we've covered—Free, Pro, PPU, Fabric—assumes internal usage. Each Power BI license type adds more users, bigger data, better performance. All good for your team.

Scenario 4: Scenario 4: Power BI Embedded (A-Type SKUs – Capacity based)

Back to Melanie’s story.

• The team’s analytics journey has matured significantly. They now want to share Power BI reports with third-party distributors and channel partners without giving them internal access./li>
• They also need field sales reps to access dashboards—people without any Power BI licenses. Buying Pro or Premium for everyone? Not in the budget.

Power BI Embedded solves this. You embed reports directly into your app. No individual licenses needed. Data stays in your application, secured by your own authentication layer.

With Embedded: users view reports through your app. No Power BI Pro or PPU licenses required.

Outcome achieved with Power BI Embedded: The data ownership resides with your custom-built application, and users don't require individual Power BI Pro license or PPU licenses to view the reports. The application built within Power BI uses a single service principal Power BI account and the dashboards can be embedded with row level security and other features which are managed by the application and your developers.

In Melanie’s case, her team built a partner analytics portal, enabling distributors and the sales field force to access curated reports directly within the company’s app — powered entirely by Power BI Embedded.

Understanding Power BI Embedded Pricing

Power BI Embedded uses capacity-based pricing (A-type SKUs), where you pay for the compute capacity, not individual users. Pricing scales with your chosen virtual cores and memory limits.

Here’s a look at the first few A-series SKUs as per Microsoft’s updated pricing (April 2025):

This model is particularly efficient for organizations embedding analytics for external users, large-scale applications, or customer portals — where licensing individual users simply doesn’t make sense.

How Power BI Embedded Compares with Fabric

While Microsoft Fabric (F-type) caters to internal consumption at scale, Power BI Embedded (A-type) is purpose-built for external distribution and embedding.

💡 Pro Tip

If your external audience is small and controlled, you could use Azure AD B2B guest access under Fabric (but each guest needs a Power BI Pro license). For larger audiences, you should look at Fabric F64 capacity, which enables the "Unlimited Free Viewing" capability for any user (internal or external) accessing that workspace or A-type SKUs.

How to choose between Power BI licensing types:

By now, we’ve given you some explanation about when and how companies leverage versions of Power BI i.e. Free, Pro, PPU, Premium per capacity, and Embedded – here is a snapshot with the differences and what’s ideal for you.

Things to note while selecting one of these licencing types and SKUs:

• You’ll have to check in the billing and the commitment too as some of these have yearly commitments.
• Understand your capacity needs based on the list mentioned above like user base and data volume needs.
• Consider how your needs change in the future and scale for them accordingly.
• Factors in total cost of ownership, such as the cost of training, administration, and infrastructure.
• Get a partner like Polestar Analytics, who understand the technicalities and can help you find the right license for you!

Microsoft Fabric & Power BI Pricing

Finally! We know it was long journey till now. But here is what you need to know about Microsoft Fabric. We’ll try to keep it short.

Microsoft Fabric, as Microsoft defines it, is an all-in-one analytics solution for enterprises that covers everything from data movement to data science, Real-Time Analytics, and business intelligence. It combines Data Factory, Synapse Analytics, Data Explorer, and Power BI into a single, unified experience, on the cloud.

If you are looking for more details about it, check out our other blog about Fabric and its components, but today we’ll stick to the pricing of Fabric w.r.t. Power BI.

Fabric Capacity vs Legacy Power BI Premium Capacity – Approximate Guide

* Prices are approximate, vary by region and offer.

Note: An F64 or larger capacity is the minimum size required to allow users with only a Free (Viewer) license to view Power BI reports. When migrating from legacy P-SKUs, organizations should map their existing capacity and user concurrency needs to an appropriate F-SKU

Getting Started with Microsoft Fabric (Free Trial)

If you are someone who are already using Power BI, and want to get a trail for Fabric, all you have to do is:

- Sign in to app.fabric.microsoft.com with your Power BI account information to access the Fabric app.

- Then, sign up for a free trial using the account manager tool in the app (no need for a credit card)

- Simple!

- This trail would include one 64-capacity unit (CU) trial capacity, which will give you full access to every Fabric experience and feature—and, up to 1 TB of OneLake storage.

With the help of Fabric and the obvious addition of Co-pilot which is included with Fabric, you can not only create visually stunning, intuitive reports but also think about the shared workloads and have a service foundation with the help of OneLake. You can see it with this very well-explained GIF from BI Polar.

Source: Where does Power BI end and fabric begin?

For now, if your question is “This ‘X’ feature on Power BI will it be available on Microsoft Fabric?” then the answer will most likely be that if the feature is shared across multiple Power BI artifacts, it’ll most likely be there. Since Fabric and Power BI share the same SaaS workloads there would be improvements and benefits to them too.

Want to get started with Microsoft Power BI or Fabric?

If you still have questions about Microsoft Power BI license types or Power BI Pro licensing cost or pricing, or want to upgrade to Fabric, including details on Power BI license types and cost, then as Microsoft partners and Power BI experts, we can help you not only choose the right license for you but also help you optimize your costs. So, feel free to reach out to us for a having a free discovery workshop.

P.S. We also conduct training and workshops around Microsoft Fabric and Power BI so if you’re interested in that we can help out too!!

FAQs