Fire Extinguishers are used by Valets to put out fires around your base. Be sure to keep them near your expensive traps and electronic equipment. The Power Plant is also a useful place to keep one handy.
The Fire Extinguisher can only be placed in corridors, though some user mods allow it to be built in other areas. The Fire Extinguisher can only be utilized by the Valet, and can otherwise not be used. Good Fire Extinguisher placement is critical, and though overplacing of the fire extinguisher is not usually a problem, it may hinder base expansion to place it on walls adjacent to unmined rock.
As hotels cannot contain corridor tiles and the nearest corridor is usually located quite far away from the hotel, many players build a topside shack near the hotel and place corridor tiles with fire extinguishers in it.
Unfortunately, valets can be quite idiotic in their use of the fire extinguishers. If a fire breaks out, the closest valet will not simply grab the nearest extinguisher and put it out. Instead, seemingly random valets all over your base will grab the extinguishers nearest them, and run to the fire, no matter how far it may be. Then, when they get there, they will put out one burning object (in a room after an explosion there can be over half a dozen objects on fire) and walk, with the extinguisher, past the other fires and put the extinguisher back. This can be quite irritating, as occationally it can lead to one fire being put out, then another object that wasn't put out exploding, and setting the original object back on fire again.