We fulfill our daily needs with the help of transformation of energy. For example we run an engine by transforming chemical energy stored in petrol into kinetic energy. According to the principle of conservation of energy, we should obtain the amount of energy which is given to the engine. But it is seen that the energy gained is always less than the energy given to. This is because some energy is lost due to the work done against the frictional force of the engine. The amount of energy obtained from the engine is called effective energy. In this case the equation of energy is,

Given energy = Effective energy + the energy lost in other ways

The efficiency of an engine means that how much of the given energy is obtained as effective energy. So, the efficiency means the ratio of effective energy and the total given energy. Usually the efficiency is expressed in percentage.

So, efficiency ƞ = (Effective energy / Total input energy) x 100%

Energy transformation takes place in different steps in a normal electricity production centre. This transformation continues from coal, oil, natural gas or Uranium up to the production of electricity. It is seen that up to 70% of this energy is lost as heat energy.

At last only the 30% of input energy is transformed into useable electrical energy. So, we can say the efficiency of the electricity production centre is 30%.