Energy is not a fuel that gets used up. It is stored in energy stores, such as the kinetic store of a moving object or the thermal store of a hot cup of tea, and it is transferred from one store to another when something happens. A system is simply the object or group of objects we choose to look at.
In a closed system no energy enters or leaves. The law of conservation of energy says that energy cannot be created or destroyed, only transferred between stores. So the total energy of a closed system is the same before and after any change. There is no net change in the total, even though the energy in individual stores goes up and down.
When a ball falls, energy is transferred from its gravitational potential store to its kinetic store. Some energy also goes to the thermal store of the air. When a hot drink cools, its thermal store decreases while the thermal store of the surroundings increases by the same amount, so the total is unchanged. Energy spread out into the surroundings is harder to use, but it has not disappeared.