(1) An application must contain the applicant's evaluation of all relevant alternatives listed in ARM 17.20.1304 leading to a ranking and selection of alternatives and selection of the proposed transmission facility.

(a) An application must include a detailed description of the methods and criteria used by the applicant to select a facility which best addresses the problem or opportunity situations identified as the basis of need (see ARM 17.20.920) given consideration of economics, engineering, and environmental concerns.

(2) In addition to the applicant's criteria for comparison, an application must include a ranking of all relevant alternatives which have no insurmountable environmental, technical or other problems serious enough to warrant elimination from further consideration, by levelized annual cost, including known mitigation costs. Alternatives whose levelized annual cost is not more than 35% higher than the proposed facility or 25% higher when the proposed facility is a transmission line 230 kV or higher and at least 30 miles long, or which have significant environmental advantages over the proposed facility, must then be compared based on performance, system impact, and environmental impact as follows:

(a) performance criteria include:

(i) total construction cost and levelized annual cost;

(ii) reliability;

(iii) duration of the solution; length of time before additional reinforcement is needed; and

(iv) constraints to implementation.

(b) system impact criteria include:

(i) for generation alternatives, the need for future expansion of the existing transmission and distribution system;

(ii) total transmission system losses;

(iii) effect, if any, on timing and need for constructing new generating facilities; and

(iv) effect on the ability of the applicant to take advantage of opportunities for economy transactions.

(c) environmental impact criteria include:

(i) significant environmental advantages and disadvantages; and

(ii) significant siting constraints.

(3) In comparing the no action alternative with other alternatives, the costs of no action shall include, if relevant, the net losses to consumers who would be deprived of the services of the facility.

(4) A full explanation must be given of the reasons for dropping any alternative from further consideration at any stage in the evaluation process.