Hi Steve
So it looks to me like it accepted the require statement, and luasql.postgres() didn't return nil, but the envv:connect() failed. I ran this program as user slitt, same as the owner of database testlua. I tried all sorts of combinations as arguments to the connect(), but they all produced the identical symptom.
Didn't you provide a password to psql and forgot to do the same with the connect() method? This kind of error occurs when there is no access to the database, but the driver is working properly... Regards, Tomás