Power Platform Pipelines update: managed environments are no longer optional

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Starting February 23, 2026, Microsoft will ensure that any environment used as a target in Power Platform Deployment Pipelines is a Managed Environment. If a target environment isn’t managed yet, it will be enabled automatically.

Why this matters
Managed Environments add the governance layer modern ALM needs:

  • More transparency for admins (usage & operational insights)

  • Better control for security and compliance

  • A stronger foundation for enterprise-ready Power Platform operations

What we recommend
To avoid surprises and stay in control:

  1. Review your pipeline targets (TEST / INT / PROD)

  2. Identify targets that are not yet managed

  3. Enable Managed Environments proactively and validate your settings

Important: Managed Environments do not require additional licenses by themselves, but they can introduce sharing limits and governance controls. Review your sharing patterns and environment settings before February 23, 2026.

References:
https://learn.microsoft.com/en-us/power-platform/alm/pipelines#can-i-ensure-pipeline-targets-are-managed-environments
https://learn.microsoft.com/en-us/power-platform/admin/managed-environment-licensing

Key Benefits of Managed Environments:

  • Usage insights - Weekly email digests with app and flow usage data

  • Sharing limits - Control how broadly apps and flows can be shared (default: 3 users)

  • Maker welcome content - Customize onboarding messages and resources for makers

  • Solution checker enforcement - Automatically validate solutions against best practices during import

  • DLP policy enforcement - Stricter data loss prevention policy application

  • Pipelines integration - Required for deployment pipeline target environments (Feb 2026+)

  • Limit sharing - Prevent apps from being shared with security groups or "Everyone"

  • IP firewall rules - Restrict environment access by IP address

  • Customer-managed keys - Enhanced data encryption control (for eligible tenants)

  • Maker analytics - Track maker activity and resource creation patterns

  • License enforcement - Automatic validation of user licenses for compliance

Reference: https://learn.microsoft.com/en-us/power-platform/admin/managed-environment-overview

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