The available energy of a system decreases as its temperature or pressure decreases and approaches equilibrium to the surroundings. When the heat is transferred from a system, its temperature decreases and hence the quality of its energy deteriorates. The degradation is more for energy loss may be the same, but quality wise the losses are different. While the first law states that energy is always conserved quantity wise, the second law emphasizes that energy always degrades quality wise. When a gas is throttled adiabatically from a high pressure region to low pressure region, the enthalpy (or energy per unit mass) remains constant, but there is a degradation of energy or available work. The same holds good for pressure drop due to friction of a fluid flowing through an insulated pipe. If the first law of thermodynamics is the law of conservation of energy, the second law of thermodynamics is also know as the law of degradation of energy.
Law of Degradation of Energy