Skulemate,
No, it's kinetic energy. But there is no big difference. If you are pumping water from a lower tank to a higher one, the pump converts electromagnetic energy to the kinetic energy of flowing water, but then this kinetic energy (or rather the part of it which is not transfered to thermal energy by friction) ends up as potential energy. If the loop is closed, the total potential energy is constant, it does not change with time. (If you look at a small "piece" of water, its potential energy changes, but this is not important for the big picture). The total kinetic energy is also constant (at equilibrium). Thus, at equilibrium, if the pump consumes a certain amount of electromagnetic energy during some interval of time, the same amount of energy will be produced by the system as heat during that interval of time. This means that when some thermal energy is converted into kinetic energy by the pump, the same amount of kinetic energy is converted to thermal energy through various kinds of friction. Botttom line: kinetic/potential energy is not worth mentioning.
myv65,
What is your definition of "useful work"? I would think that the useful work in a closed system is zero.
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