In this case, I would ask her if it's ok first, but I think she'll be happy!
It's not a stranger with an unusual name you've just heard them tell you they are dreaming and you want to use whilst they are still TTC (another thread here when I didn't think it was ok!).
It's your sister, there is a nickname for one child already, probably different surnames, you love the name, you chose it 12 year ago, it's not an uncommon or unique name! Maybe add a middle name to distinguish it a bit too if there is something you like.
The first baby born in my family of my generation was named after my grandmother. I was born about a year and a half later, second grandchild, I was also named after her! No problems at all. The family use my first and middle name to refer to me, I like it as it's a warm family thing, I know they've been calling me that since many of them were holding me as a baby. Absolutely no problem. We are a big family, with all the naming after people traditions we have multiples of several names across generations, it's actually really lovely, theres a bond there.
My brother's first child was born before I had one of the same, I knew the name I wanted forever too, my brother had the name on his shortlist and when the baby was born I actually had the last say and I chose the name I love for the baby! It's a family name and if I have one of the same, I would ask and fully expect brother to say of course go ahead.
I have a friend with a daughter whose name I freaking love, I never would have thought of it, but love it and her little girl. I told my friend in passing one day for the millionth time what a beautiful name she had chosen and said I would have chosen it if we didn't have one already, my friend said go ahead, you can still use it! I'd be naming a child after her daughter who I am very close to if I did that, we both loved the idea.