For those interested in developing/running an extension from a local directory without having to package or load it manually via "Load Temporary Addon..." from about:debuggin#/runtime/this-firefox please go to this github repository.
From the README.md:
The procedure involves a few steps, but it needs to be done only once.
First you need to enable AutoConfig aka userchrome.js by copying the file config-prefs.js to [Your Firefox install directory]/defaults/pref
Note: For best security, on Windows it is best to leave your Firefox install in "c:\Program Files" so that your config-prefs.js and userChrome.js can only be modified when you are in root/admin mode.
Then you need to edit the file userChrome.js and modify the function installUnpackedExtensions() to reflect the locations of your own addons.
The modified userChrome.js then must be copied to your Firefox installation directory. For example on Windows this is usually "c:\Program Files (x86)\Mozilla Firefox" for the 32-bit version of Firefox. You can rename the file, but remember to modify the corresponding line pref("general.config.filename", "userChrome.js") in defaults/pref/config-prefs.js
Now your addons from your local directories will be loaded automaticaly whenever Firefox starts. After editing your code remember to reload it from about:debuggin. You can also get there via the menu by selecting "More Tools", then "Remote Debugging", and click on "This Firefox" on the left side (but the quickiest way is to bookmark it and then add a bookmark keyword such as "dbg" for quick access.)
Please note that this is an automated install of the extension every time Firefox starts, so it is not quite the same as a "permenent install". That is, this procedure has exactly the same effect as clicking on "Load Temporary Addon..." from the about:debuggin page, just that the process is now automated via userChrome.js. This means that if you have code that does something after the installation of the extension such as browser.runtime.onInstalled.addListener(details => { if (details.reason == "install") { ...do something after install... });
then this code will be called every time Firefox is launched.