Return early in activate from env var collection

Author: anthonykim1

src/client/terminals/envCollectionActivation/service.ts

@@ -45,6 +45,7 @@ import {
 import { ProgressService } from '../../common/application/progressService';
 import { useEnvExtension } from '../../envExt/api.internal';
 import { registerPythonStartup } from '../pythonStartup';
+import { trace } from 'console';
 
 @injectable()
 export class TerminalEnvVarCollectionService implements IExtensionActivationService, ITerminalEnvVarCollectionService {
@@ -97,6 +98,14 @@ export class TerminalEnvVarCollectionService implements IExtensionActivationServ
 
     public async activate(resource: Resource): Promise<void> {
         try {
+            if (useEnvExtension()) {
+                traceVerbose('Return early of activate since env extension is being used');
+                this.context.environmentVariableCollection.clear();
+                // Needed for shell integration
+                await registerPythonStartup(this.context);
+                return;
+            }
+
             if (!inTerminalEnvVarExperiment(this.experimentService)) {
                 this.context.environmentVariableCollection.clear();
                 await this.handleMicroVenv(resource);