Brew house efficiency is a little complicated. It's a comparison of the max yield of your fermentables vs what you actually end up with in the fermenter. For example. Say you mash some grain, you get about an 80% efficiency. You calculated this efficiency by comparing the max gravity contribution of your grain (say 38 ppg ) to the gravity of the wort you collected. So if you mashed 10 lbs of grain and ended up with 6.7 gallons of 1.045 gravity wort.....you would have an efficiency of 79.34 % Pretty darn good. Now, after boiling, adding hops, chilling and filling your fermenter.......you end up a little short. Instead of getting 5 gallons in the fermenter like you planned you only get 4. The gravity of the wort is say 1.062. Since we lost some wort somewhere....maybe the hops absorbed it or it was lost to the bottom of the boil kettle, we lost fermentables that could have ended up in the fermenter. So, we have 4 gallons of wort @ 1.062. 62 x 4 = 248 ppg. That's our yeild. The maximum yield is 38 x 10 = 380. So........ 248 /380 = 65% So, we have a brew house efficiency of 65%.