Based on this support article, you should be able to move the photos library file to another drive. You should still be able to use iCloud Photos with this method.

I’m still new to Mac after not using one for years, so I’m not sure of a simple way of downloading all of the photos you already have stored in iCloud to the new drive, but there probably is.

I just ordered a refurbished 16 inch M1 Pro MBP. It arrived yesterday an hour before I saw the announcement of the event. But I’m still glad I got it. Way better than the HP I’ve been using.