Ante Miličević
December 18, 2023

Terraform Backends: Configuration and Management

Let’s talk about all the important aspects of terraform management and configuration.

Are you finding it difficult to configure and manage your Terraform backend? If yes, then you’ve come to the right place.

Terraform – A Quick Overview

Terraform maintains an internal data store known as the Terraform state. It holds essential information about your resources. This means when you write Terraform code for the deployment and management of, let's say, an EC2 instance, the Terraform state records specific details.

This can include information related to its creation, metadata, unique identifier, and some other properties. As a consequence, when you execute Terraform commands to modify or eliminate that particular instance, Terraform relies on the state to precisely identify the instance in question.

What is a Local Backend?

When you execute Terraform without a designated "Terraform backend," the state is stored locally in a file named "terraform.tfstate." This approach is suitable for individual developers who normally manage everything locally and don’t need to share it with others. However, when collaboration is required for your Infrastructure as Code (IaC) with others, the local Terraform state file becomes problematic. It requires synchronization among all the collaborators, introducing complexities.

This is where Terraform remote backends are a great help. They play a crucial role by providing a solution to the collaboration challenge. They offer a centralized location for storing and managing the Terraform state. With remote backends, multiple team members can work seamlessly on the same infrastructure without the hassle of manually syncing state files. This enhances collaboration efficiency and streamlines the IaC development process.

The Role of Terraform Backends

Terraform’s backend stands out as an intrinsic feature. It helps in seamlessly storing the state file in a remote location instead of a local file. The adoption of a Terraform backend reduces the concerns about state sharing among team members. While the responsibility lies in setting up the infrastructure for state storage, various options are there, extending across prevailing public cloud solutions.

Diverse Terraform backend types are at your disposal, encompassing AWS S3, GCP Cloud Storage, Azure Blob Storage, and other choices. This flexibility empowers users to select a backend that aligns with their specific infrastructure requirements and preferences.

3 Advantages of Terraform Backends

Enhanced Team Collaboration

The importance of Terraform backends is evident in their role of facilitating collaboration on a Terraform stack. Attempting such collaboration without a backend is quite impractical. These backends ensure that collaborative work aligns accurately with the current state of resources, preventing conflicts and inadvertent disruptions to colleagues' contributions.

Some Terraform backend types employ state locking, adding an extra layer of security. This feature prevents potential state corruption when multiple team members work on the state simultaneously, reinforcing the reliability of infrastructure management and establishing a secure collaborative development environment.

Access Control and Improved Security

Terraform state holds sensitive information about your cloud resources. When utilizing the local state, this sensitive data is stored in a plain-text JSON file on your local file system, which is inherently insecure.

As compared to a remote Terraform backend, the sensitive information is transiently held in memory during Terraform runs and avoids storage on your local machine. If you are opting for a Terraform backend that encrypts data at rest, such as the env0 remote backend or the s3 backend (when appropriately configured), you can intensify your security.

State Versioning and Management

When incorporating a Terraform backend, it's recommended to activate "versioning" for your storage engine whenever possible. This feature enables you to inspect and, if necessary, revert to previous state versions in case of unexpected issues.

In the realm of advanced Terraform backend, like the env0 remote backend, you gain deeper insights into state dynamics. This includes the ability to observe transitions between revisions and correlate these changes with specific Terraform runs. This proactive strategy enhances control and troubleshooting capabilities, contributing to a seamless and informed Terraform development process.

Terraform Backend Configuration

Backend Configuration

Setting up the Terraform backend is an integral aspect of your Terraform code. This involves incorporating a backend block within the primary Terraform block, which encapsulates the Terraform configuration.

Here's an example of an AWS S3 Terraform backend:

<pre class="codeWrap"><code>terraform {
 backend "s3" {
   bucket = "mybucket"
   key = "path/to/my/key"
   region = "us-east-1"

There are some important limitations of this backend configuration:

  • The configuration for the backend cannot use variables or reference locals or data sources. We’ll discuss dynamic configuration possibilities later on.
  • A configuration can only provide one backend block - so your Terraform stack can only point at a single Terraform backend.

Terraform init command

In the process of executing the Terraform init command, the system scans the root Terraform configuration file for the backend block. The selected backend is then initiated based on the provided configuration settings. This operation can involve the reading or in some cases even writing of data within the configured Terraform backend.

Therefore, it is crucial to ensure that when running the Terraform init command, you use credentials that grant access to your cloud environment. If the init command is rerun with an already-initialized backend, the working directory will be updated to incorporate the new backend settings.

Which Backend Type is a Perfect Fit for You?

As demonstrated earlier, Terraform offers several options. When deciding on a backend, there are specific considerations to steer you in the right direction.

Your Existing Stack is the Key

If you are presently using a cloud, such as GCP Cloud or MS Azure, it is advisable to opt for a backend that aligns with the cloud service in question. This choice minimizes the additional effort involved in establishing new accounts and permissions.

Additionally, if your operations are within the realms of Kubernetes or Postgres, these serve as viable options. They allow you to leverage your existing infrastructure stack instead of introducing and managing additional resources.

In the scenario where your Terraform workflow operates through a TACO platform like env0, there's an added advantage in opting for the platform's proprietary remote backend.

Data Encryption is a Must

As was mentioned earlier, your state includes sensitive information. The state is not encrypted in and of itself, but it is recommended to use a backend that can at least encrypt the data. Make sure you configure your backend for that - it’s not a setting you choose in the Terraform configuration, but rather something you need to configure when you set up the infrastructure for your backend.

The State Locking Function

State Locking is not universally supported across all backend types. If your IaC project involves a larger team, and you anticipate simultaneous runs, select a backend that explicitly supports State Locking.

Additionally, configuring the chosen backend appropriately becomes crucial to ensure effective state locking. This proactive approach enhances coordination within the team and safeguards against potential conflicts during concurrent Terraform runs.

Backend Infrastructure

To utilize a backend effectively, you'll need to establish supporting infrastructure for it. For instance, going for an S3 backend necessitates the creation of an S3 Bucket and, if opting for State Locking, a DynamoDB Table.

Depending on your encryption preferences, it might also involve setting up a KMS key for non-default bucket encryption. It is highly recommended to delve into the specific requirements of the chosen backend before finalizing your decision. Familiarizing yourself with these details ensures a well-informed decision-making process tailored to your project's needs.

Necessary permissions

It goes without saying, that you have to to grant special permissions for modifying your cloud infrastructure (GCP cloud or MS Azure, etc). However, when using a backend, it becomes essential to ensure that the Terraform process possesses the necessary permissions to both read from and write in the Backend infrastructure.

Suppose the scenario of using Terraform to manage Azure Virtual Machines with Azure Blob Storage as the backend, the provided credentials must enable the management of Virtual Machines as well as facilitate read and write operations on the Blob Storage. To address such situations, most backends incorporate their authentication configuration, allowing the customization of credentials and overriding the default ones used by the provider responsible for managing the stack's resources.

More Advanced Information about Terraform Backend

Terraform Workspaces in Infrastructure as Code (IaC)

Terraform Workspaces play a crucial role in the scalability of your Infrastructure as Code (IaC) workflow. It offer a mechanism to employ the same code for distinct environments. It means having separate workspaces for production and development. Despite executing the same code, each workspace operates with distinct configurations and is applied to different cloud accounts.

This results in separate Terraform states for each workspace, housed in different state files within their respective working directories. It's imperative to ensure that the chosen Terraform backend supports this feature, as not all backends do.

Each backend implements workspace state separation differently, and it is advisable to delve into the specifics of the chosen Terraform project's backend to comprehend this implementation and anticipate its representation in the chosen storage provider.

Dynamic Backend Configuration

As mentioned earlier, a notable constraint in Terraform's backend configuration is the inability to reference variables, locals, or data sources. As a consequence, the backend configuration becomes statically defined based on the contents of the Terraform file. It lacks the flexibility needed for diverse environments, such as staging and production. It resides in different cloud accounts with varying state storage preferences.

To address this, two dynamic configuration options exist:

Pre-processing Terraform Files: Employ a templating engine like Jinja or Sed to introduce placeholders into the Terraform backend configuration. This enables the injection of specific values before applying the configuration.

CLI Configuration: Utilize the -backend-config argument in the CLI to provide dynamic backend configurations. This allows running the same stack with different backend settings. Alternatively, you can set this through an environment variable using the TF_CLI_ARGS variable.

Backend Migration and Changes

It's crucial to recognize that making changes to your backend configuration poses inherent risks and requires meticulous handling. Any misstep in this process could lead to a different or even empty state. Consequently, Terraform could erroneously perceive existing infrastructure as new or different. Terraform automatically identifies configuration changes, prompting a reinitialization.

Key command line arguments to be aware of include:

Reconfigure: This option discards any existing configuration.

Migrate-state: This option attempts to copy the existing state to the new backend. Depending on the changes made, it may trigger interactive prompts to confirm the migration of workspace states.

When transitioning to a different backend, such as switching the S3 bucket, the following steps are recommended:Apply your stack with the old configuration.Update your backend configuration.Initialize using the -migrate-state option.

This process allows Terraform to transfer data from the old bucket to the new one, ensuring continuity in your work. If you are changing state versions in the backend and wish to "start fresh" by disregarding previous state and resources, the -reconfigure option becomes a viable choice. It's paramount to approach these backend configuration changes with caution and a clear understanding of the potential implications on your Terraform infrastructure.

Tracking the State of a Different Stack

An additional advantage provided by remote backends is the capability to share the state with other Terraform stacks. Consider a scenario where one stack configures network resources in a cloud account, managing elements like a VPC instance. Application stacks operating in that account need to run within the established VPC and must reference it for their configuration.

While one approach involves supplying the VPC ID as a variable to the application stack, this can lead to synchronization challenges and potentially bloat the variable list due to multiple dependencies.

This is where the terraform_remote_state data source becomes invaluable. It enables access to the state of a different stack stored in a remote backend. The data source mirrors the configuration of the original Backend block. Importantly, terraform_remote_state is limited to accessing outputs from the stack being read, promoting cleaner isolation and a more explicit contract between these interconnected stacks. This approach enhances manageability and clarity in handling dependencies across various Terraform stacks.

Unique Capabilities of Terraform's "Remote" Backend

Among the diverse categories of Terraform backends, the "remote" backend stands out as a distinct and unique type. Unlike other backends solely dedicated to storing the Terraform state file remotely, the "remote" backend goes a step further by furnishing the infrastructure essential for CLI-driven runs. In a CLI-driven run, although Terraform commands are initiated from the local terminal, the execution process occurs on a remote server, such as the runners in env0.

The uniqueness of the "remote" backend lies in its comprehensive functionality, which extends beyond mere state storage. Unlike backends directed at specific infrastructures like S3, a "remote" backend requires a complete TACO (Terraform Automation and Collaboration) solution like env0. Such a solution not only provides storage but also encompasses computing infrastructure.

This setup enables the leveraging of TACO benefits, including enhanced team collaboration and cloud access management. Additionally, it facilitates the execution of uncommitted code, allowing users to iterate over their work while effectively testing code changes. This distinctive capability of the "remote" backend significantly enhances workflow efficiency and testing procedures.

Key Takeaways

The configuration and oversight of Terraform backends play a pivotal role in ensuring efficient collaboration and effective state management within infrastructure-as-code projects. Teams can enhance collaboration seamlessly by adopting remote storage options from various cloud providers, eliminating the need for cumbersome synchronization of local state files.

Terraform backends contribute to elevated team collaboration, state locking, versioning, improved security, and access control. Achieving a smooth workflow necessitates meticulous backend configuration, proper infrastructure setup, and carefully defined permissions.

Dynamic configuration alternatives and Terraform workspaces introduce flexibility and scalability for diverse environments. It is imperative, however, to approach backend configuration changes cautiously to avert potential disruptions to the state.

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