New Orleans-based Entergy, with a market capitalization of $15.7 billion, trades for a modest 11 times 2009 earnings estimates of $7.50 a share. Hilliard Lyons has a 12-month price target of $100, or 25% above the recent stock price of $80. The stock is down 34% in the past 12 months. J. Wayne Leonard, Entergy's CEO, who brought the company back from the brink when he joined 10 years ago, says Entergy delivered the highest total shareholder return -- 414.3% -- of any company in its industry for the nine years ended Dec. 31, 2007. Moreover, Entergy has articulated a goal of reducing its carbon emission to 20% below its 2000 level by the end of this decade. The company, whose operating earnings rose 22% in 2007 to $5.76 a share, is expected to earn $6.60 a share for 2008, 15% above the current price.

Chicago-based Exelon, down 36% in the past 12 months, is rated Outperform by Macquarie, which has a price target of $82 on the shares, some 47% above their current price of 54. The company sees earnings of $4 to $4.30 a share in 2009, about flat with 2008. That means the stock trades for about 13 times next year's earnings and yields a hefty 3.8%.

He also likes Southern Co. (SO), an integrated utility with nuclear power and a stock that has fallen just 12% in the past 12 months. Southern has "very low relative economic sensitivity," Taber says. With a yield of nearly 5%, Taber calls it a "bond proxy," that has a relatively high return on equity and good relationships with regulators.

Even Warren Buffett got into the act last fall, with Berkshire Hathaway's Mid-American Energy Holdings investing $1 billion in Constellation Energy Group (CEG), which has extensive nuclear operations, and proposing to pay $26.50 a share in cash for the Baltimore company before losing out to France's Électricité de France (EDF.France). It is paying $4.5 billion to buy half of Constellation's nuclear-generation assets.

Exelon, meanwhile, has made an all-stock offer totaling about $6 billion, for NRG Energy (NRG), which last September became the first company to file for a permit in the new round of construction proposals.