I had briefly considered getting a diesel genset with liquid cooling. The house is heated by an oil fired water heater, so plumbing the genset into the heating system would allow me to recover most of the heat lost through the cooling system, and reduce the oil usage for heating. Winter is when the genset would be most likely required.
Combined heat and power (cogeneration) is indeed a viable way to use fuel efficiently. Although, at 92%, not significantly more efficiently than the better modern oil burning furnaces, which supposedly can peak at 98%. But are generally just over 85% to 90%.
Check this out, kinda cool.