Conservation of Energy Explained
The energy equation requires that the energy between two points may change form but the total is always conserved:
Complete Energy Equation: \frac{P_1}{\gamma} + \frac{v^2_1}{2g} + Z_1 + I_1 + e_h + e_m = \frac{P_2}{\gamma} + \frac{v^2_2}{2g} + Z_2 + I_2 + h_L

The energy in the fluid at point 1 and 2 is the total of pressure, kinetic, potential, and internal energy. The energy added from point 1 to 2 is heat and mechanical energy. The energy lost from point 1 to 2 is called "head loss" (h_{L}). Head loss is the source of many additional fluid equations including the: Darcy Weisbach Equation, Hazen Williams Equation, and Manning's Equation
The energy equation is simplified in the case of fluids where the temperature doesn't change (I_{1} = I_{2}) , no heat is added (e_{h}=0), and the only mechanical energy added is by a pump (em is replaced with hp):
where:
 P/γ = pressue head (ft)
 v^{2}/2g = kinetic head (ft)
 Z = potential head (ft)
 h_{p} = head of the pump (ft)
 h_{L} = head loss (ft)
Note: It is almost always simplest to treat all the heads in feet even though pressure heads, pump heads, and head losses are sometimes be given in psi.
Simplified to Bernoulli's Equation:
The energy equation is greater simplified in the case of fluids where the temperature doesn't change (I_{1} = I_{2}), no heat is added (e_{h} = 0), no pump is involved (e_{m} = 0), and losses are small (h_{L} = 0). In such cases, the simplified energy equation is know as Bernoulli's Theorem which says that between any two points, the total of the pressure, kinetic, and potential energy is equal:
and more generally