Offshore wind energy is considered an effective and reliable source of power with tremendous potential for Germanys' future electricity supply. Due to the technology's downsides, like capital intensity and high economic risk, offshore wind energy is mainly considered the domain of large and financially strong electric utilities. Small and medium sized municipal utilities on the contrary are traditionally characterized by strong ties to their community and low risk business models at the regional and local level. In reality however, German municipal utilities are currently advancing to forerunners in offshore wind energy based on innovative business models. The present study identifies two generic business models and reveals that in this endeavor municipal utilities are rather driven by strategic considerations than pure return expectations. It is shown how business model innovation can help to enter new markets and thus help to face the challenges of the energy transition.