The final decision on whether to extend Edinburgh's tram network to Newhaven will be taken in 2018.
Councillors are to examine a fresh report on the case for the three-mile route through Leith, which is currently forecast to cost £165.2m.
A vote will be held on the business case for the plan and whether to let officials start a procurement process for a contractor for the project.
A final decision on whether to go ahead would then be made in Autumn 2018.
If approved, the council believes construction would take approximately three years, with the first passengers boarding the new route "in the first half of 2022".
The proposed extension, which was signed off in principle by councillors in 2015, would see trams run from York Place down Leith Walk and along to Ocean Terminal, before terminating at Newhaven.
The business case for the route forecasts passenger numbers to double in the opening year of the service, to 13.7m, while Lothian Buses is projected to continue to perform "strongly".
The existing £776m tram route between the city centre and Edinburgh Airport began operation in May 2014, but only after six years of disruption and cost over-runs, and a bitter dispute between the city council and its contractor.
Oral hearings in a public inquiry over the saga will begin in September.
Figures released in December 2016 showed passenger numbers had doubled between 2014 and 2015, but services were still running at an average of 25% capacity.
Council leader Adam McVey said members would study the business case for the new route to make sure it was "as robust as possible", so they can have confidence the project is "delivered on time and on budget".
The Leith ward councillor said: "As the fastest growing city in Scotland, and with our existing system nearing capacity, we have to look at ways of enhancing our public transport system.
"The planned tram extension route takes in Scotland's most densely populated area. And taken with low car ownership, developing high-capacity transport to Newhaven would bring a range of local benefits in terms of boosting economic growth, creating jobs, enhancing accessibility, reducing congestion and improving air quality."
The business case for the extension will be considered first by the transport and environment committee, on 4 September, and then by the full council on 21 September.
Transport convener Lesley Macinnes added: "The outline business case demonstrates good early performance for the tram, with patronage expected to double in the first year.
"We have the opportunity now to study the numbers in more depth before deciding on whether to progress, taking into account the needs of the city's taxpayers, and ensuring we learn lessons from the past."