diff --git a/src/foxops/engine/initialization.py b/src/foxops/engine/initialization.py
index f9fb1aae..e9241af4 100644
--- a/src/foxops/engine/initialization.py
+++ b/src/foxops/engine/initialization.py
@@ -62,7 +62,7 @@ async def initialize_incarnation(
         template_repository=template_repository,
         template_repository_version=template_repository_version,
         template_repository_version_hash=template_repository_version_hash,
-        template_data=template_data_model.model_dump(exclude_defaults=True),
+        template_data=template_data,
         template_data_full=full_template_data,
     )
     incarnation_state.save(incarnation_root_dir / ".fengine.yaml")
diff --git a/src/foxops/services/change.py b/src/foxops/services/change.py
index 0508353f..18c6a85e 100644
--- a/src/foxops/services/change.py
+++ b/src/foxops/services/change.py
@@ -188,7 +188,7 @@ async def create_incarnation(
                 commit_sha=commit_sha,
                 requested_version_hash=incarnation_state.template_repository_version_hash,
                 requested_version=template_repository_version,
-                requested_data=json.dumps(template_data),
+                requested_data=json.dumps(incarnation_state.template_data),
                 template_data_full=json.dumps(incarnation_state.template_data_full),
             )
 
diff --git a/tests/engine/test_initialization.py b/tests/engine/test_initialization.py
index ad5d1387..2c998781 100644
--- a/tests/engine/test_initialization.py
+++ b/tests/engine/test_initialization.py
@@ -272,5 +272,5 @@ async def test_initialize_template_adds_additional_variables_to_state(tmp_path):
 
     # THEN
     assert incarnation_state is not None
-    assert "additional_variable_1" not in incarnation_state.template_data
-    assert "additional_variable_2" not in incarnation_state.template_data
+    assert "additional_variable_1" in incarnation_state.template_data
+    assert "additional_variable_2" in incarnation_state.template_data