My understanding of Tesla's idea is that in a Heat Engine where heat is being converted to another form of energy such as electricity, the LOAD serves as an effective Heat Sink. At least in part, so that the actual Cold sink does not receive the heat energy diverted to or absorbed by the load. This seems to be confirmed by various sources and/or observations made of actual Stirling Engines currently in use. For example, I have read in regard to Solar powered Stirlings in Utility power production from several sources that if the Load on the engine drops, due to less consumption from customers on the grid, there is a danger of the engine(s) overheating due to the heat not being withdrawn by the load. This seems counter-intuitive. That any engine would run cooler and more efficiently with a load than without one. However this seems to be the case. A few references: http://ntrs.nasa.gov/search.jsp?R=19820000085 From the operating instructions of a Stirling Engine from VITA (VOLUNTEERS IN TECHNICAL ASSISTANCE - 1600 Wilson Boulevard, Suite 500, Arlington, Virginia 22209 USA) The wording is somewhat ambiguous but this last reference seems to be saying that the engine "grows stronger" as the load is applied and gradually increased. A gradual increase in the load results in more torque and power and the engine runs cooler and more efficiently. These are not the only two sources, I've come across this again and again. The more "Work" the heat engine performs, the more heat is converted allowing the engine to run cooler. In some cases, such as the Free Piston Stirling, without a load it can not run at all. So it would appear that in a heat engine, the load will, to one degree or another, serve as an effective or supplemental "heat sink", for all intents and purposes. What I think this boils down to is that if an "Ambient Heat Engine" has any chance of operating at all, It could not do so without a load. You could not have such an engine that just ran on Ambient heat. Whatever power it produced would be consumed for cooling and with loses and inefficiencies, this could not go on for long if at all. But with a load, you have some of the heat being carried out or away from the system. In effect, the load becomes a secondary heat sink. I don't really know how else to explain a heat engine running cooler and more efficiently with a load than without one. I don't really know about the LED issue as it is new to me but it would seem that here also, the load is drawing off heat and converting it to another form. If ultimately the Sun is your heat source and outer space is your sink, then the only way to have an ambient heat engine would be to make it easier for the heat in the atmosphere to escape by passing through the engine and into some load and finally into space. Easier than simply radiating into space directly from the atmosphere. Imagine for example if your load were a Laser beaming light into outer space. Heat would be able to flow from the atmosphere through the engine into space Faster and easier than if it had to slowly migrate outwards through the atmosphere. If such an engine were connected to a load, (The electric grid) then it too would be powering various heat sources that would be sending infrared light out into space, Heaters, Light bulbs, Toasters, Ranges, street lights, etc. etc. "entropy" would not be violated so long as the loads on the grid were dissipating heat into space faster than the atmosphere itself, at ground level, would be capable of doing, slowly migrating through the air. Perhaps this is why the LED thing works because light from the LED can get farther out into the upper atmosphere faster, even if it is only to the ceiling of the room it's in. The Heat/Energy can get to the sink (space) faster by converting into light. To some degree, heat energy could also be "locked up" by the loads as kinetic energy, work, momentum, etc. The point is, if we think of heat flowing through a heat engine like a river, than confining ourselves to the engine as our "System" the general flow of energy can be diverted to an external load which could serve as the ultimate "heat sink" for the System. The "river" once gotten flowing by "digging a cold hole" could then be diverted into the load. In other words, you would need to trap the heat behind a lot of insulation so that it had no way to escape to outer space without first passing through the engine and into the load.