In order to make the diagnostics work, you need to import the diagnostics module in the .csdef and provide a valid connection string in the .cscfg file.
In your case, your have included the Diagnostics module correctly, however you have not provided a valid connection string in the .cscfg file. You need to replace the "AccountName" with an actual account name and the "AccountKey" with a valid account key. For that, you need to create an Azure storage account and copy its connection string here.
Also, even though it is not a part of your question, you should not use "UseDevelopmentStorage=true" while deploying the solution. It basically uses your local Storage Emulator as your Azure storage account, which is not available in cloud. You need to provide a valid storage account connection string in the worker role as well.