Yeah, obviously this isn't gonna work for embedded development, but not that many people have that specific problem. Is it really so hard to spin up ephemeral testing clusters on a single machine? Everywhere that I've seen it done, it's a horrible kludge of scripts and hacks that's almost as difficult to understand as the code under test.
I write a lot of Terraform to manage internal infrastructure with dependencies on other internal and external infrastructure that's outside of my control. I define a module parameter for each dependency (usually with a default value that points to the real service URL) and then create a second module that uses Docker to spin up and configure local instances of each dependency and overrides the corresponding parameter.
This makes local testing very straightforward: `terraform -chdir=tests apply`