diff --git a/README.md b/README.md
index fc48803..7a95ec0 100644
--- a/README.md
+++ b/README.md
@@ -82,6 +82,34 @@ To upgrade to the latest version which may have breaking changes, run `racker up
 
 Both will update the `lokoctl` and `terraform` binaries, too.
 
+### Lokomotive Baremetal Development Environment
+
+The part of Racker which creates the Lokomotive configuration can be run stand-alone to set up libvirt QEMU instances on your laptop.
+This is different from the [IPMI QEMU simulator environment](racker-sim/) which is preferred as it fully utilizes Racker.
+However, for quick development of Racker/Lokomotive this is how to run it:
+
+```
+cd /var/tmp/
+mkdir mycluster # "prepare.sh create" must run in an empty folder with just the controller_macs/worker_macs files
+cd mycluster
+echo 0c:42:a1:11:11:11 > controller_macs
+echo 0c:42:a1:11:11:22 > worker_macs
+# compile the right Lokomotive branch used in Racker (see installer/conf.yaml)
+sudo rm -r /opt/racker/terraform/
+sudo mkdir -p /opt/racker/terraform
+sudo cp -r /home/$USER/kinvolk/lokomotive/assets/terraform-modules/matchbox-flatcar/* /opt/racker/terraform
+PATH="$PATH:/home/$USER/kinvolk/lokomotive" /home/$USER/kinvolk/racker/bootstrap/prepare.sh create
+[…]
+PATH="$PATH:/home/$USER/kinvolk/lokomotive" lokoctl cluster apply # or any other things you want to do
+[…]
+# later destroy it again:
+PATH="$PATH:/home/$USER/kinvolk/lokomotive" /home/$USER/kinvolk/racker/bootstrap/prepare.sh destroy
+```
+
+It will create two bridges, one for the internal PXE and one for the network with Internet access (using NAT).
+Matchbox and dnsmasq are started as containers (when using Podman matchbox is a user container and dnsmasq a root container).
+The `/opt/racker-state/` folder gets populated with the Flatcar image and the Matchbox configuration.
+
 ## Code of Conduct
 
 Please refer to the Kinvolk [Code of Conduct](https://github.com/kinvolk/contribution/blob/master/CODE_OF_CONDUCT.md).
diff --git a/bootstrap/prepare.sh b/bootstrap/prepare.sh
index 8d7a02b..1319fe3 100755
--- a/bootstrap/prepare.sh
+++ b/bootstrap/prepare.sh
@@ -523,7 +523,11 @@ function gen_cluster_vars() {
     name="controller"
   fi
   for mac in ${MAC_ADDRESS_LIST[*]}; do
-    node_color="$(echo "$NODES" | grep ${mac} | cut -d , -f 4 | xargs)"
+    if [ -n "$USE_QEMU" ]; then
+      node_color=""
+    else
+      node_color="$(echo "$NODES" | grep ${mac} | cut -d , -f 4 | xargs)"
+    fi
     ip_address="$(calc_ip_addr $mac)"
     if [ "$type" = "lokomotive" ]; then
       id="${CLUSTER_NAME}-${name}-${count}.${KUBERNETES_DOMAIN_NAME}"
@@ -630,7 +634,7 @@ EOF
     tee -a "${variable_file}" >/dev/null <<-EOF
 	kernel_console = []
 	install_pre_reboot_cmds = ""
-	pxe_commands = "sudo virt-install --name \$domain --network=bridge:${INTERNAL_BRIDGE_NAME},mac=\$mac  --network=bridge:${EXTERNAL_BRIDGE_NAME} --memory=${VM_MEMORY} --vcpus=1 --disk pool=default,size=${VM_DISK} --os-type=linux --os-variant=generic --noautoconsole --events on_poweroff=preserve --boot=hd,network"
+	pxe_commands = "sudo virsh destroy \$domain || true; sudo virsh undefine \$domain || true; sudo virsh pool-refresh default || true; sudo virsh vol-delete --pool default \$domain.qcow2 || true; sudo virt-install --name \$domain --network=bridge:${INTERNAL_BRIDGE_NAME},mac=\$mac  --network=bridge:${EXTERNAL_BRIDGE_NAME} --memory=${VM_MEMORY} --vcpus=1 --disk pool=default,size=${VM_DISK} --os-type=linux --os-variant=generic --noautoconsole --events on_poweroff=preserve --boot=hd,network"
 EOF
   else
     # The first ipmitool raw command is used to disable the 60 secs timeout that clears the boot flag