A Microsoft file hosting and synchronization service.
I am having the same kind of problems. My mac is clearly storing OneDrive files locally, even though I used OnDemand only. What is worse is that using OnDemand now means that when I try to use the file it downloads it again basically, so using twice as much space. Somewhere on my mac is a shadow version of all my OneDrive files and I can't find it to get rid of it!