In thermodynamics, heat engines are often modeled using a standard engineering model such as the Otto cycle. The theoretical model can be refined and augmented with actual data from an operating engine, using tools such as an indicator diagram. Since very few actual implementations of heat engines exactly match their underlying thermodynamic cycles, one could say that a thermodynamic cycle is an ideal case of a mechanical engine. In any case, fully understanding an engine and its efficiency requires a good understanding of the (possibly simplified or idealised) theoretical model, the practical nuances of an actual mechanical engine and the discrepancies between the two.
In general terms, the larger the difference in temperature between the hot source and the cold sink, the larger is the potential thermal efficiency of the cycle. On Earth, the cold side of any heat engine is limited to being close to the ambient temperature of the environment, or not much lower than 300 kelvin, so most efforts to improve the thermodynamic efficiencies of various heat engines focus on increasing the temperature of the source, within material limits. The maximum theoretical efficiency of a heat engine (which no engine ever attains) is equal to the temperature difference between the hot and cold ends divided by the temperature at the hot end, each expressed in absolute temperature.
The efficiency of various heat engines proposed or used today has a large range:
*3% (97 percent waste heat using low quality heat) for the ocean thermal energy conversion (OTEC) ocean power proposal
*25% for most automotive gasoline engines
*49% for a supercritical coal-fired power station such as the Avedøre Power Station
*60% for a combined cycle gas turbine
The efficiency of these processes is roughly proportional to the temperature drop across them. Significant energy may be consumed by auxiliary equipment, such as pumps, which effectively reduces efficiency.