terraform-refactor-module

name	terraform-refactor-module
description	Transform monolithic Terraform configurations into reusable, maintainable modules following HashiCorp's module design principles and community best practices.
metadata	{"copyright":"Copyright IBM Corp. 2026","version":"0.0.1"}

Skill: Refactor Module

Overview

This skill guides AI agents in transforming monolithic Terraform configurations into reusable, maintainable modules following HashiCorp's module design principles and community best practices.

Capability Statement

The agent will analyze existing Terraform code and systematically refactor it into well-structured modules with:

• Clear interface contracts (variables and outputs)
• Proper encapsulation and abstraction
• Versioning and documentation
• Testing frameworks
• Migration path for existing state

Prerequisites

• Existing Terraform configuration to refactor
• Understanding of resource dependencies
• Access to current state file (for migration planning)
• Knowledge of module registry patterns

Input Parameters

Parameter	Type	Required	Description
source_directory	string	Yes	Path to existing Terraform configuration
module_name	string	Yes	Name for the new module
abstraction_level	string	No	"simple", "intermediate", "advanced" (default: intermediate)
preserve_state	boolean	Yes	Whether to maintain state compatibility
target_registry	string	No	Target module registry (local, private, public)

Execution Steps

1. Analysis Phase

**Identify Refactoring Candidates**
- Group resources by logical function
- Identify repeated patterns
- Map resource dependencies
- Detect configuration coupling
- Analyze variable usage patterns

**Complexity Assessment**
- Count resource relationships
- Measure variable propagation depth
- Identify cross-resource references
- Evaluate state migration complexity

2. Module Design

Interface Design

# Define clear input contract
variable "network_config" {
  description = "Network configuration parameters"
  type = object({
    cidr_block         = string
    availability_zones = list(string)
    enable_nat         = bool
  })

  validation {
    condition     = can(cidrhost(var.network_config.cidr_block, 0))
    error_message = "CIDR block must be valid IPv4 CIDR."
  }
}

# Define output contract
output "vpc_id" {
  description = "ID of the created VPC"
  value       = aws_vpc.main.id
}

output "private_subnet_ids" {
  description = "List of private subnet IDs"
  value       = { for k, v in aws_subnet.private : k => v.id }
}

Encapsulation Strategy

**What to Include in Module:**
- Tightly coupled resources (VPC + subnets)
- Resources with shared lifecycle
- Configuration with clear boundaries

**What to Keep Separate:**
- Cross-cutting concerns (monitoring, tagging)
- Resources with different lifecycles
- Provider-specific configurations

3. Code Transformation

Before: Monolithic Configuration

# main.tf (monolithic)
resource "aws_vpc" "main" {
  cidr_block = "10.0.0.0/16"
  enable_dns_hostnames = true

  tags = {
    Name = "production-vpc"
    Environment = "prod"
  }
}

resource "aws_subnet" "public_1" {
  vpc_id            = aws_vpc.main.id
  cidr_block        = "10.0.1.0/24"
  availability_zone = "us-east-1a"

  tags = {
    Name = "public-subnet-1"
    Type = "public"
  }
}

resource "aws_subnet" "public_2" {
  vpc_id            = aws_vpc.main.id
  cidr_block        = "10.0.2.0/24"
  availability_zone = "us-east-1b"

  tags = {
    Name = "public-subnet-2"
    Type = "public"
  }
}

resource "aws_internet_gateway" "main" {
  vpc_id = aws_vpc.main.id

  tags = {
    Name = "production-igw"
  }
}

# ... more repetitive subnet and routing resources

After: Modular Structure

# modules/vpc/main.tf
locals {
  subnet_count = length(var.availability_zones)
}

resource "aws_vpc" "main" {
  cidr_block           = var.cidr_block
  enable_dns_hostnames = var.enable_dns_hostnames
  enable_dns_support   = var.enable_dns_support

  tags = merge(
    var.tags,
    {
      Name = var.name
    }
  )
}

resource "aws_subnet" "public" {
  for_each = var.create_public_subnets ? toset(var.availability_zones) : []

  vpc_id                  = aws_vpc.main.id
  cidr_block              = cidrsubnet(var.cidr_block, 8, index(var.availability_zones, each.value))
  availability_zone       = each.value
  map_public_ip_on_launch = true

  tags = merge(
    var.tags,
    {
      Name = "${var.name}-public-${each.value}"
      Type = "public"
    }
  )
}

resource "aws_internet_gateway" "main" {
  count  = var.create_public_subnets ? 1 : 0
  vpc_id = aws_vpc.main.id

  tags = merge(
    var.tags,
    {
      Name = "${var.name}-igw"
    }
  )
}

# modules/vpc/variables.tf
variable "name" {
  description = "Name prefix for all resources"
  type        = string
}

variable "cidr_block" {
  description = "CIDR block for the VPC"
  type        = string

  validation {
    condition     = can(cidrhost(var.cidr_block, 0))
    error_message = "Must be a valid IPv4 CIDR block."
  }
}

variable "availability_zones" {
  description = "List of availability zones"
  type        = list(string)
}

variable "create_public_subnets" {
  description = "Whether to create public subnets"
  type        = bool
  default     = true
}

variable "enable_dns_hostnames" {
  description = "Enable DNS hostnames in the VPC"
  type        = bool
  default     = true
}

variable "enable_dns_support" {
  description = "Enable DNS support in the VPC"
  type        = bool
  default     = true
}

variable "tags" {
  description = "Tags to apply to all resources"
  type        = map(string)
  default     = {}
}

# modules/vpc/outputs.tf
output "vpc_id" {
  description = "ID of the VPC"
  value       = aws_vpc.main.id
}

output "vpc_cidr_block" {
  description = "CIDR block of the VPC"
  value       = aws_vpc.main.cidr_block
}

output "public_subnet_ids" {
  description = "Map of availability zones to public subnet IDs"
  value       = { for k, v in aws_subnet.public : k => v.id }
}

output "internet_gateway_id" {
  description = "ID of the internet gateway"
  value       = try(aws_internet_gateway.main[0].id, null)
}

# Root configuration using module
module "vpc" {
  source = "./modules/vpc"

  name               = "production"
  cidr_block         = "10.0.0.0/16"
  availability_zones = ["us-east-1a", "us-east-1b", "us-east-1c"]

  tags = {
    Environment = "production"
    ManagedBy   = "Terraform"
  }
}

4. State Migration

Generate Migration Plan

# migration.tf
# Use moved blocks for state refactoring (Terraform 1.1+)

moved {
  from = aws_vpc.main
  to   = module.vpc.aws_vpc.main
}

moved {
  from = aws_subnet.public_1
  to   = module.vpc.aws_subnet.public["us-east-1a"]
}

moved {
  from = aws_subnet.public_2
  to   = module.vpc.aws_subnet.public["us-east-1b"]
}

moved {
  from = aws_internet_gateway.main
  to   = module.vpc.aws_internet_gateway.main[0]
}

Manual State Migration (Pre-1.1)

# Generate state migration commands
terraform state mv aws_vpc.main module.vpc.aws_vpc.main
terraform state mv aws_subnet.public_1 'module.vpc.aws_subnet.public["us-east-1a"]'
terraform state mv aws_subnet.public_2 'module.vpc.aws_subnet.public["us-east-1b"]'
terraform state mv aws_internet_gateway.main 'module.vpc.aws_internet_gateway.main[0]'

5. Module Documentation

# VPC Module

## Overview
Creates a VPC with configurable public and private subnets across multiple availability zones.

## Features
- Multi-AZ subnet deployment
- Optional NAT gateway configuration
- VPC Flow Logs integration
- Customizable CIDR allocation

## Usage

\`\`\`hcl
module "vpc" {
  source = "./modules/vpc"

  name               = "my-vpc"
  cidr_block         = "10.0.0.0/16"
  availability_zones = ["us-east-1a", "us-east-1b"]

  create_public_subnets  = true
  create_private_subnets = true
  enable_nat_gateway     = true

  tags = {
    Environment = "production"
  }
}
\`\`\`

## Requirements

| Name | Version |
|------|---------|
| terraform | >= 1.5.0 |
| aws | ~> 5.0 |

## Inputs

| Name | Description | Type | Default | Required |
|------|-------------|------|---------|----------|
| name | Name prefix for resources | `string` | n/a | yes |
| cidr_block | VPC CIDR block | `string` | n/a | yes |
| availability_zones | List of AZs | `list(string)` | n/a | yes |

## Outputs

| Name | Description |
|------|-------------|
| vpc_id | VPC identifier |
| public_subnet_ids | Map of public subnet IDs |
| private_subnet_ids | Map of private subnet IDs |

## Examples

See [examples/](./examples/) directory for complete usage examples.

6. Testing

Use skill terraform-test

Test File: A .tftest.hcl or .tftest.json file containing test configuration and run blocks that validate your Terraform configuration.

Test Block: Optional configuration block that defines test-wide settings (available since Terraform 1.6.0).

Run Block: Defines a single test scenario with optional variables, provider configurations, and assertions. Each test file requires at least one run block.

Assert Block: Contains conditions that must evaluate to true for the test to pass. Failed assertions cause the test to fail.

Mock Provider: Simulates provider behavior without creating real infrastructure (available since Terraform 1.7.0).

Test Modes: Tests run in apply mode (default, creates real infrastructure) or plan mode (validates logic without creating resources).

File Structure

Terraform test files use the .tftest.hcl or .tftest.json extension and are typically organized in a tests/ directory. Use clear naming conventions to distinguish between unit tests (plan mode) and integration tests (apply mode):

my-module/
├── main.tf
├── variables.tf
├── outputs.tf
└── tests/
    ├── unit_test.tftest.hcl      # Unit test (plan mode)
    └── integration_test.tftest.hcl  # Integration test (apply mode - creates real resources)

Refactoring Patterns

Pattern 1: Resource Grouping

Extract related resources into cohesive modules:

• Networking (VPC, Subnets, Route Tables)
• Compute (ASG, Launch Templates, Load Balancers)
• Data (RDS, ElastiCache, S3)

Pattern 2: Configuration Layering

# Base module with defaults
module "vpc_base" {
  source = "./modules/vpc-base"
  # Minimal required inputs
}

# Environment-specific wrapper
module "vpc_prod" {
  source = "./modules/vpc-production"
  # Inherits from base, adds prod-specific config
}

Pattern 3: Composition

# Small, focused modules
module "vpc" {
  source = "./modules/vpc"
}

module "security_groups" {
  source = "./modules/security-groups"
  vpc_id = module.vpc.vpc_id
}

module "application" {
  source     = "./modules/application"
  vpc_id     = module.vpc.vpc_id
  subnet_ids = module.vpc.private_subnet_ids
  sg_ids     = module.security_groups.app_sg_ids
}

Common Pitfalls

1. Over-Abstraction

# ❌ Don't create overly generic modules
variable "resources" {
  type = map(map(any))  # Too flexible, hard to validate
}

# ✅ Do use specific, typed interfaces
variable "database_config" {
  type = object({
    engine         = string
    instance_class = string
  })
}

2. Tight Coupling

# ❌ Don't couple modules through direct references
# module A
output "instance_id" { value = aws_instance.app.id }

# module B (in same config)
resource "aws_eip" "app" {
  instance = module.a.instance_id  # Tight coupling
}

# ✅ Do pass dependencies through root module
module "compute" {
  source = "./modules/compute"
}

resource "aws_eip" "app" {
  instance = module.compute.instance_id
}

3. State Migration Errors

Always test migration in non-production first:

# Create plan to verify no changes after migration
terraform plan -out=migration.tfplan

# Review carefully
terraform show migration.tfplan

# Apply only if plan shows no changes
terraform apply migration.tfplan

Version Control Strategy

# Use semantic versioning for modules
module "vpc" {
  source  = "git::https://github.com/org/terraform-modules.git//vpc?ref=v1.2.0"
  version = "~> 1.2"
}

# Pin to specific versions in production
# Use version ranges in development

Success Criteria

• Module has single, well-defined responsibility
• All variables have descriptions and types
• Validation rules prevent invalid configurations
• Outputs provide sufficient information for consumers
• Documentation includes usage examples
• Tests verify module behavior
• State migration completed without resource recreation
• No plan differences after refactoring

Related Skills

• Terraform code generation - Style guide for the new Terraform Module
• Azure Verified Modules - Recommended module specifications for Azure

Resources

• Terraform Module Development
• Module Best Practices

Revision History

Version	Date	Changes
1.0.0	2025-11-07	Initial skill definition