Demand only drops if it becomes more expensive than it is already. If the difference is that solar during the day becomes super cheap then you don't get a reduction in demand during the night, you get more demand during the day.
That doesn't reduce the amount of nighttime generation capacity you need at all, unless people can shift demand from nighttime to daytime, which they largely can't. Most of the things that run at night either have to run 24 hours or have to run at night because you need light when it's dark and heat when it's cold.
Worse so, if demand for electricity drops at night that doesn't mean that people are going to go to sleep. That means they are going to use cheaper alternatives to make light. That has bigger consequences in emissions.
My worry would be people continuing to use carbon sources to generate more heat than light. With LED lights as efficient as they are, nobody is going to replace them with lanterns. The real trouble is if people don't replace their existing oil and gas furnaces with electric heat pumps, because that's something we need to happen but also has the disadvantage of requiring an initial capital expenditure. Adding higher nighttime electrical costs on top of that would not be helpful.
That doesn't reduce the amount of nighttime generation capacity you need at all, unless people can shift demand from nighttime to daytime, which they largely can't. Most of the things that run at night either have to run 24 hours or have to run at night because you need light when it's dark and heat when it's cold.