What is Potential energy (with example)

Energy is the capacity to do work. Energy is a scalar quantity. Unit of measurement of energy is Jole, same as that of work.
Potential energy:
The energy possessed by a body due to its position is called potential energy. A stone kept on the top of tower possessed energy with respect to the ground level, because in coming to the ground it is capable of doing work.

Potential energy diagram

In this case the stone on the top of the tower possesses potential energy. Therefore, if the mass of the stone is m kg and its height above the ground level is ‘h’ metres, then its potential energy with respect to ground level is,
PE = m x g x h = Wh
P.E. = m g h Joule