What best defines potential energy?

Not in all cases. This happens due to the interruption of non conservative forces like friction, air resistance, etc. which are responsible for decreasing the mechanical energy by converting it into other forms of energy such as heat, noise, etc.

The two main types of potential energy are:

1. Gravitational Potential Energy - Energy stored due to an object's position in a gravitational field (PE = mgh).
2. Elastic Potential Energy - Energy stored in deformed elastic objects like springs or stretched materials (PE = ½kx²).

The best way to find potential energy is to use the relationship 

${}_{}$ $U_f-U_i=-{\int }_i^f\overrightarrow{F}\cdot d\overrightarrow{r}$

and integrating the conservative force over the path.

For common cases, apply the standard potential energy formulas:

• PE = mgh for gravity
• PE = ½kx² for springs.