Energy is the capacity to do work. Any system be it an electrical system, a mechanical system or our own body, needs energy to do work. This could be of any nature like electrical, mechanical, thermal etc. The main fact is it cannot be created out of nothing and also it cannot be destroyed. All that one can do with it is just convert or transform from one form to another. This is what is explained by the law of conservation of energy.
Let’s imagine a moving car hitting a parked one. A parked car has got some potential energy which is nothing but the stored enegy that hasn’t yet been used. We know that static objects possess potential energy. It is the result of its position/condition without any motion. When the car starts, the engine burns fuel converting the fuel’s enegy into mechanical energy that makes the tires rotate. This rotation leads to movement of car. Any object in motion is said to possess kinetic enegy. While in motion, if the driver hits the brakes, the car comes to a halt. Now what happens? When applying sudden brakes, there would be some screeching noise and also the tires become hot. Thus, kinetic enegy gets converted into sound and heat energy. In any way, the energy is never lost and always gets transformed from one form to another. Thus, it is conserved.
The first person to confirm the law of conservation is James Joule. He conducted experiments to prove that it cannot be created anew or lost in any system and that it can only be converted from one form to another. In his honor, the name joule was recognized as international scientific unit of energy.