Try sudo@sssd2 ?

net/cloud-init/files/patch-cloudinit_settings.py

@@ -0,0 +1,20 @@
+--- cloudinit/settings.py.orig	2021-03-17 15:43:42 UTC
++++ cloudinit/settings.py
+@@ -12,7 +12,7 @@
+ CFG_ENV_NAME = "CLOUD_CFG"
+ 
+ # This is expected to be a yaml formatted file
+-CLOUD_CONFIG = "/etc/cloud/cloud.cfg"
++CLOUD_CONFIG = "%%PREFIX%%/etc/cloud/cloud.cfg"
+ 
+ RUN_CLOUD_CONFIG = "/run/cloud-init/cloud.cfg"
+ 
+@@ -50,7 +50,7 @@ CFG_BUILTIN = {
+     "system_info": {
+         "paths": {
+             "cloud_dir": "/var/lib/cloud",
+-            "templates_dir": "/etc/cloud/templates/",
++            "templates_dir": "%%PREFIX%%/etc/cloud/templates/",
+         },
+         "distro": "ubuntu",
+         "network": {"renderers": None},