I had one catch fire on me. Customer dropped it off overnight with a charging complaint. I go out to check it - sure enough it's stone dead. Grab my jump pack with the intention of a test run and probably drive it around to one of the bays. Starts up, and immediately sparks start shooting out of the back of the alt and something inside is glowing red hot. I hurry around and turn off the key. When the fan on the alt stops, I get about a 12" flame leaping out of the thing. I about $hit my pants of course..... I did manage to (barely) blow out the fire and was left with a smoking, melted alternator.
I've run a lot of safety meetings and been party to many more. Never has anyone mentioned the need for a fire extinguisher when performing a jump and basic charge test. But yeah - I would have to say there is cause.
GD