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How come it was enough to set a different database URL in the development server and BAM you're connected to the production database?

Do they share the same password? Or is the password in the URL?

The database URL usually has the username and password as well.

For example: postgresql://[user[:password]@][netloc][:port][/dbname][?param1=value1&...]

For anything using libpq a .pgpase file can help separate creds in source/conf from now machine level ACLS.

*.pgpass

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No, its a URL. Connection strings have a different format, as clearly shown in the example in your link.