Nginx local proxy with backup to prod server

Question

I am trying to setup nginx proxy on my local machine. What I want to achieve is like this:

site.local -> proxy_pass -> HTTP://localhost:3000 if localhost:3000 is down, then proxy to -> site.com

So far this is my config:

upstream mysite {
  server localhost:3000 fail_timeout = 5 max_fails = 1;
  server example.com backup max_fails = 2;
}

server {
  server_name site.local;
  listen ssl;
  ssl_certificate /path/to/site-local.crt;
  ssl_certificate_key /path/to/site-local.key;
  ssl_ciphers HIGH: !aNULL: !MD5;


  location / {
    proxy_pass https://mysite;
    proxy_set_header Host site.com;
    proxy_set_header X-Forwarded-For $remote_addr;
  }
}

And I've made entry in hosts file for site.local 127.0.0.1.

I am getting multiple errors with slightly different configurations:

1. I am doing proxy_pass HTTP://mysite, then it is 301 redirecting to https://example.com, and not proxying to https.
2. If I did proxy_pass: https://mysite, then it is giving 502.
3. If I am doing server site.com:443 then it is saying non https traffic to 443 server is not allowed.

Any ideas around how to achieve this.