diff --git a/docker/docker-compose.yml b/docker/docker-compose.yml
--- a/docker/docker-compose.yml
+++ b/docker/docker-compose.yml
@@ -158,12 +158,6 @@
     image: postgres:12
     env_file:
       - ./env/storage-db.env
-    environment:
-      # unset PGHOST as db service crashes otherwise
-      PGHOST:
-      # unset POSTGRES_DB: we're handling db creation ourselves in the backend
-      # service entrypoint
-      POSTGRES_DB:
 
   swh-storage:
     image: swh/stack
@@ -176,7 +170,7 @@
       - kafka
     env_file:
       - ./env/common_python.env
-      - ./env/storage-db.env
+      - ./env/storage.env
     environment:
       SWH_CONFIG_FILENAME: /storage.yml
       STORAGE_BACKEND: postgresql
diff --git a/docker/env/storage-db.env b/docker/env/storage-db.env
--- a/docker/env/storage-db.env
+++ b/docker/env/storage-db.env
@@ -1,6 +1,4 @@
 # Please sync changes in storage-read-replica-db.env
 
-PGHOST=swh-storage-db
-PGUSER=postgres
 POSTGRES_PASSWORD=testpassword
 POSTGRES_DB=swh-storage
diff --git a/docker/env/storage.env b/docker/env/storage.env
--- a/docker/env/storage.env
+++ b/docker/env/storage.env
@@ -1,5 +1,7 @@
-POSTGRES_PASSWORD=testpassword
-POSTGRES_DB=swh-storage
 PGHOST=swh-storage-db
 PGUSER=postgres
-SWH_CONFIG_FILENAME=/storage.yml
\ No newline at end of file
+
+POSTGRES_PASSWORD=testpassword
+POSTGRES_DB=swh-storage
+
+SWH_CONFIG_FILENAME=/storage.yml
diff --git a/docker/services/swh-storage/entrypoint.sh b/docker/services/swh-storage/entrypoint.sh
--- a/docker/services/swh-storage/entrypoint.sh
+++ b/docker/services/swh-storage/entrypoint.sh
@@ -26,13 +26,13 @@
       ;;
     *)
       if [ "$STORAGE_BACKEND" = "postgresql" ]; then
-          wait_pgsql template1
+          wait_pgsql ${POSTGRES_DB}
 
           echo Database setup
-          if ! check_pgsql_db_created; then
-              echo Creating database and extensions...
-              swh db create --db-name ${POSTGRES_DB} storage
-          fi
+
+          echo Creating extensions...
+          swh db init-admin --db-name ${POSTGRES_DB} storage
+
           echo Initializing the database...
           swh db init --db-name ${POSTGRES_DB} storage
       fi