Microsoft has had some interesting products over the years, but we haven't seen them going for household utilities yet. In a paper that's recently shown up on Microsoft's Research site, the company demonstrates a concept to heat households using "Data Furnaces" which are actually distributed cloud servers.
In the research paper, Microsoft makes a case for using servers as a replacement for heaters in houses, saying that "cloud computing is hot, literally" and that "computers can be placed directly into buildings to provide low latency cloud computing for its offices or residents, and the heat that is generated can be used to heat the building."
The paper speaks in very simple terms, stating that a "computer server is a metal box that converts electricity into heat" and the exhaust air is around 40-50C which is "perfect for heating purposes, cloth dryers, water heaters and agriculture." The company appears to be doing the research in the interest of carbon footprint reduction, saying that if they replaced half of home heating with these data furnaces, the IT industry could "double in size without increasing its carbon footprint."
It appears Microsoft has done a lot of research with the paper providing a deep level of information that details how the servers could be installed and how they could work. For example, a server (or Data Furnace) could be configured to process data during the winter at night, but not as heavily during the summer in order to keep temperatures down. The company also points out that they could use older servers to reduce costs because their inefficiency and higher heat levels would be ideal to heat a home.
Microsoft thinks they could save anywhere from $280 to $320 USD a year per server compared to having it housed in a data center. They even say in the paper that they could replace actual furnaces with servers and charge consumers the same amount, thus generating income on the server as well.
As global warming issues become more pressing and prices go up, Microsoft appears to be exploring options other than building new datacenters across the world as it looks to minimize not only its costs, but also the impact of these installations on the environment.