Closed system vs open system. The laws of thermodynamics apply to closed systems which are theoretical (can one really prove that any system is completely closed to outside influence?). An “open system” refers to a system (i.e. dam power generation plant) that receives stimulus external to itself (water at a certain height/potential energy) which has an effect on the system output. You could pose the same question about solar power or geothermal power or wind farms etc…
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