Looking at https://bugs.launchpad.net/ubuntu/+source/cloud-init/+bug/974509 it seems like if the private cloud has a 'ubuntu-mirror' dns name, then cloud-init might pick that up as the mirror.
More specifically, for local provider with lxc, a ubuntu-mirror entry could be pushed to dnsmasq on the host such that it is picked up automatically.
Looking at https:/ /bugs.launchpad .net/ubuntu/ +source/ cloud-init/ +bug/974509 it seems like if the private cloud has a 'ubuntu-mirror' dns name, then cloud-init might pick that up as the mirror.
More specifically, for local provider with lxc, a ubuntu-mirror entry could be pushed to dnsmasq on the host such that it is picked up automatically.