Last Updated on February 13, 2026
Looking for a Microsoft Copilot alternative without recurring inference costs? Consider using LocalAI with local LLMs directly within Microsoft Word. LocalAI is a free, open-source alternative to OpenAI and acts as a drop-in replacement for the OpenAI API, enabling local inferencing without recurring fees. With LocalAI, you can run LLMs locally or on-premises using consumer-grade hardware, supporting various model families and architectures — and it doesn’t require a GPU. This solution allows you to generate text, images, and audio directly on your own machine.
📖 Part of the Local AI Infrastructure Guide This post is a deep-dive cluster page within our Local AI Infrastructure Guide—your definitive roadmap to building a private, high-performance AI stack.
See it in Action
To see how easily LocalAI can be integrated into Microsoft Word without incurring inference costs, check out this demonstration video. For more examples, visit our video library at @GPTLocalhost!
Infrastructure in Action: The Local Advantage
Setting up your local AI infrastructure is the first step; the second is putting it to work. Running models locally via GPTLocalhost turns your infrastructure into a professional drafting tool with three key advantages:
- Data Sovereignty: Your sensitive documents never leave your local drive, ensuring 100% privacy and compliance.
- Hardware Optimization: Leverage the full power of your GPU or Apple Silicon for low-latency, high-performance drafting.
- Air-Gapped Reliability: Work anywhere—including high-security environments or even on a plane ✈️—with no internet required.