Hi,
12v 500mA is 12*0.5 = 6W. 5v*1.5A = 7.5W. So it's not possible.
If you use 7805, you can't draw more than 400-500mA from your transformer. If you used switching, you could draw about an amp or so.
For 1.5A, you can't use 7805. You can use LM317 or LM350. If you use switching, take a look at L4971.
Generally, we can use 1000uF per amp of current. So 1500uF would do. You could use higher for lower ripple, eg, 2200uF.
The voltage rating has to be atleast 2xAC voltage. So if you have 12v AC coming in, the capacitor must be rated at more than 2x12 = 24v. So a 25-50V would do nicely.
Example regulator circuit:
Hope this helps.
Tahmid.
---------- Post added at 18:52 ---------- Previous post was at 18:51 ----------
For R2, you could have a pot so that you can adjust the output to perfect 5v to compensate for resistance tolerance.