What does "when used as an alternate" mean in the context of 135.225(e)?

Question

Here's the text of 135.225(e)

[No pilot may begin an instrument approach procedure to an airport unless] The MDA or DA/DH and visibility landing minimums prescribed in part 97 of this chapter or in the operator's operations specifications are increased by 100 feet and 1/2 mile respectively, but not to exceed the ceiling and visibility minimums for that airport when used as an alternate airport, for each pilot in command of a turbine-powered airplane who has not served at least 100 hours as pilot in command in that type of airplane.

I'm interested in the bold part of the text. Does it mean:

1. If a pilot shoots an approach at their destination, misses, and chooses to go to their alternate, they need not increase mins at the alternate
2. If a pilot intends to shoot an approach at their destination, they need not increase mins if doing so would make those mins higher than if the airport was their alternate
3. Or something else entirely?

References for your answers are appreciated!

Answer 1

The "No pilot may begin an instrument approach procedure to an airport unless" is a section of it's own, named (a), followed by conditions (1) and (2). Section (a) is not linked to section (e) in the manner you suggest.

Section (e) deals with a

... pilot in command of a turbine-powered airplane who has not served at least 100 hours as pilot in command in that type of airplane.

The portion you emphasized makes an exception to the rules set by section (e) in the case where the approach is made to an alternate airport.

So simplified version would be that a pilot with less than 100h of PIC experience in turbine aircraft must use higher minimums when flying IFR approach in a turbine aircraft. If the approach is being made to an alternate airport, the minimums of that airport are used.