This post is a part of the PL-300: Microsoft Power BI Data Analyst Exam Prep Hub; and this topic falls under these sections:
Prepare the data (25–30%)
--> Get or connect to data
--> Change Data Source Settings, including Credentials & Privacy Levels
Note that there are 10 practice questions (with answers and explanations) at the end of each section to help you solidify your knowledge of the material. Also, there are 2 practice tests with 60 questions each available on the hub below the exam topics section.
Managing data source settings is a core responsibility of a Power BI Data Analyst and a frequently tested skill on the PL-300: Microsoft Power BI Data Analyst exam. This topic focuses on understanding how Power BI connects to data, how credentials are stored and updated, and how privacy levels affect data combination and security.
On the exam, you’re rarely asked where to click. The emphasis will likely be on conceptual understanding, decision-making, and troubleshooting. You’re likely to be tested on things like what happens when credentials are wrong, why a refresh fails, or how privacy levels affect query behavior.
What Are Data Source Settings in Power BI?
Data source settings define how Power BI authenticates, accesses, and combines data from one or more sources. These settings exist at two primary levels:
- Power BI Desktop (development and modeling)
- Power BI Service (publishing, refresh, and sharing)
Key components include:
- Authentication credentials
- Privacy levels
- Data source permissions
- Refresh behavior
Managing Credentials
What Are Credentials?
Credentials determine who Power BI is when it connects to a data source. If credentials are invalid, expired, or mismatched between environments, refreshes will fail.
Common Authentication Types (Exam-Relevant)
- Windows authentication
- On-premises SQL Server
- Often paired with gateways
- Database authentication
- SQL login stored in Power BI
- Independent of user identity
- Microsoft Entra ID (OAuth)
- Cloud sources (Azure SQL, Power BI datasets)
- Most common for Power BI Service
- Anonymous
- Public web data
- Rare in enterprise scenarios
Where Credentials Are Managed
In Power BI Desktop
- File → Options and settings → Data source settings
- Credentials are stored locally
- Used during development and testing
In Power BI Service
- Managed per dataset
- Required for scheduled refresh
- Often paired with a gateway for on-premises data
📌 Exam tip:
Credentials in Desktop do not automatically carry over to the Power BI Service.
Updating or Changing Credentials
You may need to update credentials when:
- Passwords expire
- Data sources move environments
- Ownership of a dataset changes
- Refresh failures occur after publishing
On the exam, expect scenarios like:
“A dataset refresh fails after being published. It worked in Power BI Desktop.”
The likely solution:
- Update credentials in Power BI Service
- Configure or reconfigure the gateway
Understanding Privacy Levels
Privacy levels control how Power BI isolates data sources when combining data to prevent unintended data leakage.
The Three Privacy Levels
Public
- Data is publicly available
- Lowest level of isolation
- Examples: public websites
Organizational
- Internal company data
- Can be shared within the organization
- Common for corporate databases
Private
- Highly sensitive data
- Strict isolation
- Cannot be freely combined with other sources
Why Privacy Levels Matter
When Power BI combines multiple data sources:
- It enforces privacy isolation
- It may block query folding
- It may require additional processing
📌 Key exam concept:
Privacy levels affect data combination behavior, not just security.
Privacy Levels and Query Folding
Privacy levels can:
- Prevent Power BI from pushing transformations back to the source
- Force local evaluation of queries
- Reduce performance
Example:
- Combining a Private SQL database with a Public web source may prevent query folding.
📌 Exam takeaway:
Privacy settings can impact performance, not just access.
The “Ignore Privacy Levels” Setting
Power BI Desktop allows you to:
- Ignore privacy levels (for development or testing)
⚠️ Important for the exam:
- This setting does not apply in Power BI Service
- Service refresh always enforces privacy levels
Common Exam Scenarios and What They’re Testing
Scenario 1: Refresh Fails in Service
Tests:
- Understanding of credential scope
- Knowledge of service-side configuration
Correct thinking:
- Credentials must be set in the Power BI Service
- Gateway may be required
Scenario 2: Combining Multiple Data Sources
Tests:
- Privacy level understanding
- Data leakage prevention
Correct thinking:
- Choose appropriate privacy levels
- Understand impact on query folding
Scenario 3: Dataset Ownership Changes
Tests:
- Credential reassignment
- Dataset security awareness
Correct thinking:
- Credentials may need to be re-entered
- Refresh ownership matters
Key Exam Takeaways
For the PL-300 exam, remember:
- Credentials define who Power BI is when accessing data
- Desktop and Service credentials are separate
- Privacy levels control data isolation
- Privacy levels affect data combination and performance
- Ignoring privacy levels works only in Desktop
- Refresh failures often point to credential or gateway issues
If you understand why Power BI behaves the way it does with credentials and privacy, you’ll answer these questions confidently—even when the wording is tricky.
Practice Questions
Go to the Practice Exam Questions for this topic.
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