If the Raulothim's Psychic Lance spell "dissipates without effect", is the spell slot consumed?

Question

I was reading the description of the Raulothim's Psychic Lance spell (Fizban's Treasury of Dragons, p. 21) and I was left with a question. Raulothim's Psychic Lance gives the following alternative targeting rule:

Alternatively, you can utter a creature's name. If the named target is within range, it becomes the spell's target even if you can't see it. If the named target isn't within range, the lance dissipates without effect.

The question I'm left with: If the psychic lance is "dissipated" in this fashion, when cast from a spellcaster that uses spell slots, does psychic lance consume the spell slot?

My first thought is to go to the Invalid Spell Targets rules (XGE, p. 85-86), which state the following relevant section:

If you cast a spell on someone or something that can't be affected by the spell, nothing happens to that target, but if you used a spell slot to cast the spell, the slot is still expended.

However, this applies generally to all spells if you target someone/something that is an invalid target. Raulothim's Psychic Lance has specific language dealing with the target not being there, however it's not clear to me what "dissipate" would mean in relation to spell slots.

So, in my mind, this leaves me with the following possible answers:

"If the named target isn't within range, the lance dissipates without effect"...

1. ... is a restatement of the rules for Invalid Spell Targets in XGE, and the spell slot is consumed.
2. ... is a specific rule for the spell, and "dissipates without effect" means the spell slot is consumed.
3. ... is a specific rule for the spell, and "dissipates without effect" means the spell slot is not consumed.

Which interpretation is correct?

Answer 1

You’ve already cast the spell, so the spell slot is expended.

The rules for casting a spell tell us (emphasis mine):

Each spell description in Chapter 11 begins with a block of information, including the spell’s name, level, school of magic, casting time, range, components, and duration. The rest of a spell entry describes the spell’s effect.

This means that to get to the part of the spell description that tells us the lance dissipates, we have to cast the spell first. The lance dissipating is the spell’s effect, and you have to cast the spell to get the spell’s effect. You cast the spell, so you expend a spell slot.

Answer 2

The spell slot is consumed

Even if you ignore the guidance from XGE which also tells you that the spell slot is consumed.

For the lance to “dissipate” (i.e. to dissapear, to waste or fritter away, according to the dictionary), it needs to be created first. So the spell needs to have been cast, otherwise it could not have created the lance. And a spell slot is consumed when you cast the spell.