It is now possible (as of Windows Azure SDK 2.1) to run the azure emulator without admin privileges. You can choose a 'Use Emulator Express' option in the project properties in Visual Studio, see Debugging a Cloud Service with Emulator Express.
You can also, pass /useemulatorexpress
to csrun on the command line.
Limitations
Before you use Emulator Express, you should be aware of some limitations:
Your cloud service can contain multiple roles, but each role is limited to one instance.
You can't access port numbers below 1000. For example, if you use an authentication provider that normally uses a port below 1000, you might need to change this value to a port number that's above 1000.
Any limitations that apply to the Windows Azure Compute Emulator also apply to Emulator Express. For example, you can't have more than 50 role instances per deployment.
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