So change the setting to 1080 at 12Mbps.
Plex reads the Peaks and Valleys.
If the Peaks go outside the limits - transcode.
Are you sure that HEVC file will play on the remote device?
Also - there is a whole Sub-Novel to this all encompassing thread wherein this very thing is under investigation - of sorts…:
Peaks and Valleys.
Not to mention this request has been going for a while:
The server should control the remote client quality - but it doesn’t.
So, if setting that remote client isn’t something that is easily done.
(like if your Grandmother is on the other end)
That’s when the problem starts.