This is about the first generate_prime example in chapter 5.9 (not on github afaik). The text refers to the candidate array (is_prime) and how it looks like after each iteration. The code does something else though. It overrides each True entry for a prime number in the is_prime array to False due to the initialization of the second loop.
The second loop should be initialized with
for i in range(p * 2, n + 1, p):