The increasing expansion of RES leads to a reduction of load factor and hence decreasing profitability of conventional thermal power plants. This means, peak load power plants will face difficulties to cover their full costs in an energy only market. Therefore investment in conventional thermal power plants becomes more and more risky and is likely to decrease. Since these power plants are essential in maintaining long term security of supply, referred to as generation adequacy, a mechanism for encouraging investment should be implemented. This could take the form of administratively determined capacity payments, which is a pay-ment to power plant operators determined by the regulator, aimed at covering their fixed costs. In countries like Spain, Ireland, Chile and Argentina this mechanism seems to facilitate construction of new power plants, although the results cannot be attributed to the mechanism entirely. In the near future the market of Germany and Austria is faced with the phase-out of nuclear power plants in Germany, impending shutdown of obsolete power plants and a grow-ing share of wind power and PV generation. A capacity payment mechanism should be con-sidered, since this mechanism can be implemented in a timely manner and without compro-mising the current market structure. As shown in a simplified scenario for the upcoming 15 years, the expansion of power plants should mainly consist of CCPP and gas turbine in order to ensure the least cost for the entire system. When it comes to passing on the costs of the capacity payments to consumers, it should be weighed according to their attribution to peak load. Therefore, households will have to make the highest contribution. Even though, the additional charge for electricity for households would be relatively low in the years to come.