Ways thermodynamics is supposed to lose energy

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Scientists look for limits. Engineers look for ways around them.

If there were some fundamental limit in converting heat to work that causes loss of energy, one of the following would have to be true.

During conversion of heat to work, there is an unavoidable loss of heat or work.
No machine, theoretical or real, can exceed the limit.
The second law effectively says the system cannot be restored to its initial state without loss of energy.
When any expansion occurs, if a portion of the expansion is "not" fuel heat (such as ambient heat), but still cools, so even if the unused heat were recycled, the machine would also have to replace the amount the ambient heat cooled.

In fairness, this is indeed a difficult problem to solve, but #2 points to a theoretical machine that solves it. It only takes one counter example to disprove the absolute. In the following pages, discussed are the possible types of recycling machines.

The main, and simple, answer to all the claims is Energy = Work+Heat; The claim arises from the fact that most machines exhibit this behavior.

There are two common misconceptions. First, that creating work converts only a portion of heat energy, and the other energy is "lost". This cannot happen, if the above equation is true.
The idea is disproved by counter-example. Here is a machine which approaches 100% efficiency. An impractical, but theoretically sound machine. If there exists one, then there can be more.
The second misconception is that because one cannot convert all heat energy in a finite expansion, that it is consequently impossible to reach 100% efficiency from any fuel source. Some heat "must" be exhausted. The second law appears to support this, but that's because many mis-copies of the law leave off the vital part at the end, which says "unless something else also changes". It does not preclude machines from returning to their initial state without significant loss of energy, it simply means a simple expansion machine is not enough.
The problem of replacing the heat of expansion lost due to the "base" or initial temperature is actually solved by compression. Under compression, the ambient heat undergoes changes that are cancelled out by expansion. Compression brings some other problems with it, but there are useful engine designs with insulated compression (adiabatic), uninsulated compression, and no compression, all of which exceed the "limit".

Creating a more efficient machine does create quite a puzzle, and the puzzle has several puzzles and so on.