In every change to a system, some energy ends up spread out in the surroundings. Most of it is stored as thermal energy in the air and nearby objects, and this store is much less useful than the one the energy came from. This spreading out is called dissipation.
Take a mobile phone being charged. Energy from the mains is transferred to the chemical store of the battery, but the charger and phone get warm, so some energy is dissipated to the surroundings. When a kettle boils water, some energy warms the kettle itself and the air around it instead of the water.
A falling ball that hits the ground is another example. Its kinetic energy is transferred to the thermal store of the ball and the ground, and to sound that spreads into the air. The ball never bounces back to its original height, because energy has been dissipated.
Dissipated energy is wasted because it is so spread out that we cannot easily use it again. The total energy is conserved, but it is now stored in a less useful way.