Abstract Outflows in active galactic nuclei (AGN) are considered a promising candidate for driving AGN feedback at large scales. However, without information on the density of these outflows we cannot determine how much kinetic power they are imparting to the surrounding medium. Monitoring the response of the ionization state of the absorbing outflows to changes in the ionizing continuum provides the recombination timescale of the outflow, which is a function of the electron density. We have developed a new self-consistent time-dependent photoionization model, tpho, enabling the measurement of the plasma density through time-resolved X-ray spectroscopy. The algorithm solves the full time-dependent energy and ionization balance equations in a self-consistent fashion for all the ionic species. The model can therefore reproduce the time-dependent absorption spectrum of ionized outflows responding to changes in the ionizing radiation of the AGN. We find that when the ionized gas is in a nonequilibrium state its transmitted spectra are not accurately reproduced by standard photoionization models. Our simulations with the current X-ray grating observations show that the spectral features identified as multicomponent warm absorbers, might in fact be features of a time-changing warm absorber and not distinctive components. The tpho model facilitates accurate photoionization modeling in the presence of a variable ionizing source, thus providing constraints on the density and in turn the location of the AGN outflows. Ascertaining these two parameters will provide important insight into the role and impact of ionized outflows in AGN feedback.