To fix this problem you only need to to add write permissions to the
directory structure created by novascript.

If you look at the /var/log/libvirt/qemu/instance-INSTANCE_ID.log you
will see the error written in the last line. It's trying to create the
console.log file but there is a problem with the permissions. Probably
you are running the novascript as root in a folder with root only
permissions.

-- 
euca-run-instances fails to run VM
https://bugs.launchpad.net/bugs/655217
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