Provider registry.terraform.io/hashicorp/template v2.2.0 does not have a package available for your current platform, darwin_arm64
The templatefile function only works with files. If you're working with files then switch to templatefile.
The hashicorp/template provider's template_file data source works with template strings and files (converted to strings) but was archived/deprecated before creating an arm release forcing people to look into other options if using Apple M1 (based on ARM).