I had the same issue as you, and couldn't find a way to override the default environment variable used when no env arg is passed, but found a workaround that worked for me:

Simply change the file path that is standing for the dev environment in the angular cli configuration file (angular-cli.json):

// ...
"environments": {
  "dev": "environments/environment.local.ts",
  "prod": "environments/environment.prod.ts"
},
// ...

dev is the default environment variable used by Angular CLI if no args are passed, so the local file would be the used one.

For Angular 6+ follow these instructions:

First you will define your environments in your angular.json, create those files, and then you will run via "ng serve --configuration dev"

This document covers the details of the above:

https://theinfogrid.com/tech/developers/angular/environment-variables-angular/

Additionally you will need to define the same in the "serve" section of the JSON...i.e:

"serve": {
 [...]
 "configurations": {
   "production": {
     "browserTarget": "myApp:build:production"
   },
   "debug": {
     "browserTarget": "myApp:build:debug"
   }
 }

Try using the --environment option through the CLI:

ng serve --environment prod will use the environment.prod.ts file.

You can also configure your environments in .angular-cli.json file.

Hope this helps!