This paper investigates the integration of waste heat from a Power-to-X (PtX) plant into a district heating system (DHS) using a digital twin (DT) approach to optimize energy efficiency and manage complex system dynamics. Focusing on a case study of a new PtX plant in Kassø, southern Jutland, supplying waste heat to the district heating network of Aabenraa, this paper combines model-based and data-driven techniques through business ecosystem mapping and multi-agent-based simulation to evaluate integration viability and efficiency. The results indicate significant reductions in natural gas consumption and operational costs, demonstrating the feasibility of PtX waste heat integration. The DT model’s detailed simulations provide insights into optimizing operational strategies, balancing heat supply and demand, and ensuring system reliability. These findings underscore the critical role of DTs in advancing energy efficiency and decarbonization in urban heating systems.