Which agile estimation units should you use? You can use any arbitrary units to estimate backlog items in an agile project. It does not matter if you do your estimation with story points, ping pong balls, man days, man hours, kLoCs. After a while your teams will converge on a common understanding of what the units mean.
Agile Estimation Units for Sprints vs in the Backlog
Sprint estimation is done based on tasks rather than backlog items. Perhaps there is a case for using hours instead of story points as agile estimation units in sprint planning.
Coffee Cups as Agile Estimation Units
Since the units of estimation are arbitrary why not use coffee cups? Coffee cups are good as more work requires more coffee. Harder work requires more coffee. Over time requires a lot more coffee. Coffee cups, like backlog items, come in different sizes. Are your items espressos or pots of weak coffee?
Another advantage of coffee cups as units of estimation are that they are readily available when you need them. Estimation and follow up is mainly done in some of the agile meetings. And in all those meetings, there are plenty of coffee cups.
I have recently revisited this topic in a new blog post.