There are huge losses in the transmission, production and usage of electricity and the reduction of these losses in order to save electricity is called as conservation of energy.
As per the statistics, there is loss of nearly 4% while the transmission of electricity. Like wise during production also, lot of electricity get wasted due to the inefficient material used. None of the production material nor the equipment used have 100% efficiency and thus there is always a possibility of energy wastage.
When it is said that the energy is wasted , it simply means that the energy production which should have been 100% as per calculation is not completely derived from the source due to the inefficient conversion process. For example, a turbine while rotating must convert 100 % of the water energy or water falling on it into electrical energy but the turbine is not able to do so as some of the water is lost or its energy is lost before conversion while going through the mechanical process.