At nearly every public webinar I’ve run this year, somebody asks me some version of the same question:
We don’t have Copilot licenses. Is there anything we can actually do with AI in Excel?
As I write this, most Microsoft 365 users are still working without a paid Copilot seat. Last fall, while thinking through what that actually means for Excel users, I wrote about how to get AI-ready even without paid Copilot:
That post focused on the foundations: getting your Excel data into better shape, structuring it properly, and building related skills like Python in Excel so you’re ready to make good use of AI when it shows up.
All of that still applies. But since then, Microsoft has added a meaningful amount of AI capability directly into Excel even for users without the paid Microsoft 365 Copilot add-on. I don’t think most organizations realize how much they may already have access to.
A tale of two Copilots
When people say “Copilot in Excel,” they’re often talking about two different things.
Microsoft 365 Copilot is the paid add-on, currently $30 per user per month on top of a qualifying Microsoft 365 subscription. This is the version that can work across your organization’s Microsoft 365 data, including files, emails, Teams conversations, and other information available through Microsoft Graph. Paid users also get priority access to certain features and models.
Copilot Chat is different. It’s a chat experience included with eligible Microsoft 365 business and enterprise subscriptions at no additional charge, as described in the Microsoft 365 Copilot Chat overview.
Microsoft lays out the distinction in Decide which Copilot is right for you.
In late 2025, Microsoft started putting Copilot Chat directly inside the desktop and web versions of Word, Excel, PowerPoint, and OneNote. That meant a very large number of users suddenly had an AI chat pane sitting inside Excel even though their organization hadn’t bought them a Copilot license.
You can see which experience you’re using from the label in the product. According to the Copilot in Excel FAQ, “M365 Copilot (Basic)” means you’re using the included tier, while “M365 Copilot (Premium)” means you have the paid license.
That distinction matters because the two experiences are definitely not the same.
What you can actually do with Copilot Chat in Excel
There is still quite a bit you can do with the included tier:
- You can ask questions about the workbook you have open.
- You can get help writing and explaining formulas, which I think is one of the most immediately useful applications for Excel users. If you’ve inherited some 400-character formula monster, Copilot can help explain what it’s doing. If you know the calculation you need but don’t know the exact formula, you can describe it, see what Copilot gives you, and refine from there.
- You can also upload files into the chat and ask for summaries, analysis, or sanity checks. Microsoft’s Copilot Chat FAQ explains how file uploads work, including the fact that uploaded files are stored in your OneDrive for Business.
- And, of course, you can use it as a thinking partner before you start building anything. Ask how it would approach a model, how it would structure an analysis, or what might be missing from your logic.
Microsoft keeps a useful comparison in How Copilot Chat works with and without a Microsoft 365 Copilot license.
The limitations matter too.
Without the paid license, Copilot Chat does not have access to your organization’s broader Microsoft 365 data. It can’t go through your SharePoint sites, inbox, Teams conversations, or your coworkers’ files looking for context. Microsoft Graph grounding is part of the paid experience.
You also don’t get priority access. During busy periods, the included tier may be slower or limited, which Microsoft discusses in Standard versus priority access to features in Microsoft 365 Copilot Chat.
And some newer capabilities, such as switching between AI models, require the paid subscription.
So while the free experience is far from useless, it lacks many of the features that take Copilot from a good AI assistant to a great one for Excel workflows.
But free or paid, AI always has its limits and places where it should and should not be used. My general rule still applies: I like Copilot and AI for exploration, drafting, explanation, and sense-making. For repeatable production work, I still want deterministic tools like formulas, Power Query, and Python in Excel doing the heavy lifting. The license tier doesn’t change that.
The 2,000-seat rule, and other things that change frequently
This is where things get messy. Everything around Copilot changes quickly. The included tiers here for free Copilot may be the messiest part because Microsoft is still deciding exactly how much capability it wants to give away.
A good example came in 2026. After putting Copilot Chat inside the Office apps for a huge number of users in late 2025, Microsoft announced that beginning April 15, 2026, organizations with more than 2,000 Microsoft 365 users would lose the in-app Copilot Chat experience in Word, Excel, PowerPoint, and OneNote for users without paid Copilot licenses.
Organizations below that threshold keep the experience under Microsoft’s standard-access model, which can include throttling at peak times and prompts to upgrade.
Oddly enough, this change was communicated largely through Microsoft 365 admin Message Center notices rather than a nice clean public documentation page I can point you toward. Licensing specialists at SAMexpert and reporting at Reworked have both covered the change, including the relevant Message Center notification IDs.
If you work at a large organization, your Microsoft 365 admins should have visibility into those notices even if you don’t.
I’m not going to pretend I know why 2,000 is the magic number, or whether it will still be the magic number six months from now. The exact line between “included” and “paid” keeps moving. Treat any blog post about Copilot licensing, including this one, as a snapshot.
Using it safely at work
This is probably the other question I hear most often:
How do I know my data is safe when I’m using the free version?
If you’re signed into Copilot Chat with your work account, Microsoft provides what it calls enterprise data protection. Your prompts and responses aren’t used to train the underlying models, Microsoft 365’s existing data protection commitments apply, and files you upload are stored in your OneDrive for Business.
Microsoft documents this in Microsoft 365 Copilot Chat privacy and protections.
There’s also a useful visual check: Microsoft says you’ll see a green shield icon when enterprise data protection is active. Look for it in your Copilot window. You should see something like the example below.
This protection makes Copilot Chat meaningfully different from an employee copying company information into some random free consumer AI account.
Frankly, this is one of the stronger arguments for organizations giving employees a sanctioned AI option. If people want to use AI and you give them nothing, some percentage of them are going to find their own workaround.
One important clarification: these protections apply when you’re using Copilot through your organization’s Microsoft 365 account. Microsoft’s enterprise data protection documentation explains the details.
If you sign in with a personal Microsoft account, you’re using the consumer product under different terms. And really, you shouldn’t be doing company work on a personal AI account anyway.
In short: your company’s IT policies still win. Your admins control what Copilot Chat can access, whether web grounding is enabled, and which features are available in your tenant. Microsoft’s minimum requirements for Copilot Chat documentation explains some of those controls.
Your organization may also have rules around confidential, regulated, client, or sensitive information that go well beyond Microsoft’s technical safeguards. I can tell you generally how Copilot works. But from the outside, I can’t tell you whether your organization permits a particular use, so when in doubt, follow your company’s policies.
Where to go from here
If you already have Copilot Chat in Excel, I wouldn’t start by trying to build some elaborate AI workflow.
Start with boring, useful stuff:
- Ask it to explain a formula.
- Ask it to draft a formula and then check the result yourself.
- Use it to summarize a file.
- Ask it to help you think through an analysis before you build it.
Those are low-impact ways to start learning what AI is good at without rebuilding your entire Excel workflow around it.
At the same time, keep working on the less glamorous stuff: Tables, good data structure, Power Query, formulas, and, where it makes sense, Python in Excel. Those skills make Copilot more useful. They also make you less dependent on Copilot.
And if your organization eventually considers buying the paid licenses, you’ll be in a much better position to evaluate whether the additional capabilities are actually worth paying for.
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