Recently after a domain password change, I got the following error in trying to run the webrole.
Can not log on locally to WebRole as user "domain\username" with virtual directory password
Resolving this error is simple.
1. Open IIS Manager
2. Select the site. Default Web site in my case and click "Basic Settings..."
3. This opens the Edit Site dialog.Click "Connect as".
4. In the Connect As dialog, click Set and provide the new password in the Set Credentials dialog.
5. Come back to Edit Site dialog and click "Test Settings..."
6. Once the connections succeeds, you should be able to successfully open the site in your browser.