Potential energy exists whenever an object which has mass has a position within a force field. The most everyday example of this is the position of objects in the earth's gravitational field.
Kinetic Energy exists whenever an object which has mass is in motion with some velocity.
Conservation of energy
Energy in a system may take on various forms. The law of conservation of energy states that energy may neither be created nor destroyed. Therefore the sum of all the energies in the system is a constant.