Marine operations in harsh conditions often involve extreme environments. Despite advancements in numerical schemes, challenges persist in modelling these wave fields. An example is the application of potential flow methodology, which is efficient but limited by its inadequacy in accounting for energy dissipation due to wave breaking. Currently, empirical dissipation models with coefficients calibrated against experimental observations are often used. However, how these coefficients vary across the broad range of wave breaking scenarios, ranging from incipient breaking to extreme wave plunging is not well understood. The purpose of this paper is to account for the variability of these coefficients through a better understanding of the dissipation mechanics. Using a validated two-phase Reynolds-Averaged Navier-Stokes (RANS) model, which reproduces the essential physics of a plunging wave, we not only reinforce existing observations on the total energy lost due to wave breaking but also show that, for a plunging wave, 77% of that energy loss is closely linked to the bifurcation of flow near the wave crest that contributed to wave breaking. Additionally, similar to 19% of the energy loss may be attributed to the work done by the wave compressing the entrapped air. Together, the energy associated with both the plunging jet and the air entrapment could account for up to 96% of the total energy loss.