Cells use chemical, mechanical, and electrochemical energy for work. Potential energy is the capacity to do work. In molecules, potential energy is called chemical energy. Kinetic energy is the energy of motion. The transfer of energy releases heat.
This animation (Audio - Important) illustrates energy flow through the environment starting with the sun. Recall our discussion in the second lecture about the importance of solar radiation to the existence of life. Ultimately the energy from the sun drives reactions at the molecular level.