Energy is conserved according to the law of conservation, meaning it cannot be created or destroyed, only transformed. When a battery powers an LED, the chemical energy is converted into light and thermal energy, with some energy lost as heat during each conversion process. The emitted light interacts with various surfaces, contributing to heat and potentially affecting the environment, such as being absorbed or reflected. While the total energy remains constant, the conversion processes increase the universe's entropy. Thus, energy is not stored in a specific location but dissipates into the environment, contributing to overall entropy changes.