Dataverse's "Manage Capacity" page for a particular environment allows to allocate capacity for Database, File and Log within available capacity of each category in the tenant. That available capacity is calculated by simply subtracting all consumed and allocated storage from tenant's available storage.

However, it doesn't take in account the consumption of the environment for which allocation is being configured - the amount available for allocation should be incremented by the current consumption of the environment.

Example:

Total log capacity of tenant is 2 TB. There are no allocations for any environments. A single environment consumed 1.5 TB of log storage. This leaves 0.5 TB to be allocated. If I'll try to allocate 1.6 TB of log storage for that same environment I'll get an error:

    "key": "invalidAllocationQuantity",

    "message": "Invalid allocation quantity: EntitlementId=Log RequestedAllocationQuantity=1600 AvailableQuantity=500"

It just doesn't make sense because I'm trying to set the allocation just 100 MB over the current consumption. The resulting allocation will not exceed tenant's capacity and should be allowed.