http://www.youtube.com/watch?v=38N9Ba7xFcs
Ace Frehley doing the Smoking solo in 1979
Now Ace's guitars have been modified for that purpose, the neck and middle pickups are fakes: the cavity of the neck pickup holds a strong halogen lightbulb and a smoke bomb and is covered with fire resistant material from the inside and the whole back of the guitar is routed out to hold batteries to run the light on and another to ignite the smoke bomb. Ace has a switch near the output of his guitar that sets the whole thing off.

The rear view of one of Ace's late Seventies smokers, which could well be the guitar from the clip.
Ace still does this thing but every so now and then it still goes wrong.
http://www.youtube.com/watch?v=FQleuSTovok
Not often that one needs a fire extinguisher after a hot solo.