When attempting to create a virtual machine (VM) with a virtual Trusted Platform Module (vTPM) using a vSphere Standard license, the following error is observed:
License not available to perform the operation. The vSphere 8 Standard license for "Host" <HOST_FQDN> does not include "vSphere VM Encryption". Upgrade the license
VMware vSphere ESXi 7.x
VMware vSphere ESXi 8.x
It is not mandatory to enable VM encryption for a vTPM-enabled virtual machine (VM), but the customer inadvertently attempts to enable VM encryption on an ESXi host with only a vSphere Standard license.
Note: When you configure a vTPM, the virtual machine files are encrypted but not the disks. Refer to How vSphere Virtual Machine Encryption Protects Your Environment
Do not enable VM encryption when attempting to create a vTPM-enabled virtual machine (VM) on an ESXi host with a vSphere Standard license.
For the vSphere VM Encryption feature, refer to Unable to enable VM encryption on the VM failing with error "License not available to perform the operation"
To create a vTPM-enabled VM, refer to How to Create a vTPM-Enabled Virtual Machine on a Host Without a physical TPM