The example for ALTER USER MAPPING is missing the action keyword (ADD|SET|DROP).
Since ADD is the default option, the given command attempts to add a user 'bob' to the already-existing user mapping 'bob', which throws an 'ERROR: option "user" provided more than once'
Here's a working example that a) matches the description ("change password") and b) continues the steps started with the CREATE USER MAPPING example.
ALTER USER MAPPING FOR bob SERVER foo OPTIONS (SET password 'public');