Apologies, that warning was poorly worded and incorrect.
In addition to the existing DB on disk you’ll need enough free space for the dump output and the new copy of the DB as it’s restored. pg_dump’s output is usually smaller than the DB data directory, so 2x the current DB in free space should be enough. I’ll get this corrected in the upgrade script.
EDIT: The free space check has now been updated to look for 2x DB size instead of 3x.