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This thesis examines how building-level load shifting can contribute to heat load flexibility in Mälarenergi’s district heating system, and how the resulting system benefits can be translated into economic incentives. The study was divided into three stages. First, a peak‑shaving strategy was applied to an apartment building, using a model predictive control approach to evaluate its ability to temporarily reduce heat demand, while maintaining indoor comfort. The apartment was representative for the case study and the results showed that the building was able to provide measurable flexibility and achieved peak reductions during all periods and participation levels. Low participation levels showed  small impact with a peak reduction of 2.5 – 3.6 %, depending on the period, but increases substantially with increasing participation levels to 4.6-13.1 %. Second, the  identified flexibility was scaled to system level by combining the building’s reduction profile  with historical load data from Mälarenergi’s district heating network. These scenarios were then simulated in EO3, a production optimization program, to assess how load shifting affects production costs, electricity production, and peak load boiler use. The simulations indicated that even moderate levels of customer participation could lead to noticeable cost reductions. During full participation in winter, substantial cost-saving potential and a  significant reduction in peak boiler use was observed at almost 4 GWh in January alone. In  spring and autumn, the impact was limited, since the loads were low and load  variations were covered by Mälarenergi’s thermal storages. Finally, the cost-saving term was  developed to create economic incentives through a proposed price-model adjustment, for  customers to contribute with heat flexibility. The saving term represented the system-level  cost savings and functioned as a customer discount based on the peak reduction, and was  designed to be fair, easy to communicate, and compatible with existing tariff structures.  Overall, the study demonstrated that load shifting could reduce peak loads and production  costs, and that a system benefit-based pricing model adjustment could offer a feasible  approach to activating customer‑side flexibility in district heating systems.