Since the beginning of Formula One's hybrid era, Mercedes has had the engine to beat. Mercedes has won the last four Formula One constructor's championship with drivers Lewis Hamilton and Nico Rosberg winning every driver's championship. The 1.6 liter V6 has not only been the most powerful, but it's also been one of the most thermal efficient racing engines ever built.
While engines develop energy, they're also great at wasting it. You're lucky if an engine has 30 percent thermal efficiency. Through a lot of innovation, Mercedes has devised an engine that achieves more than 50 percent efficiency.
There are quite a few elements to this, like the combustion process and the unique split turbo which splits the compressor and turbo across both sides of the engine. These are elements that I'm definitely not qualified to explain in detail because I'm not close to being an engineer of any sort.
But Jason Fenske from Engineering Explained is an engineer and should be able to help: