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Gravitational potential energy is the energy an object has due to its position above Earth, energy due to its height. We know this energy exists because it takes effort to lift an object up to a height and also because when we release an object, it falls, gaining kinetic energy.
Any object which is moving relative to you, will have kinetic energy. An example would be a bullet fired from a gun. Gravitational potential energy occurs when something is lifted up above some reference point (ie the ground). After it is lifted, it can be dropped, at which point it's potential energy will turn into kinetic energy as it speeds up. An example would be water at the top of a waterfall. Source(s):