The sleep recharge section lets you see how your "batteries" have been recharged according to the amount of sleep that you have had versus your sleep requirement. Note, the sleep requirement defaults to 8 hours, but you can change this in the Wizard. It is displayed for last night's sleep and compared to the average of the previous 7 days.
This appears both in the AutoSleep iPhone app just below the clock and also in the Watch app.
You can also add the Sleep Recharge as a Today View widget.
There is a difference in this information based on whether or not you wear your Watch to bed. If wearing your Watch to bed, the time and recharge percent is based on actual time asleep. If not wearing your Watch to bed then it is based on the simple recorded sleep time.
Tidying up your Average
If you had a Watch problem, forgot to wear your Watch or some other disaster struck that prevented a correct record of sleep for a given day, you can exclude it from all average calculations and remove the entry from Apple Health database.
You will find this option as a switch below the recharge section on the main clock.