The nature and origin of the enormous power of enzymes was examined. First, the catalytic effect was defined by clarifying the importance of defining a proper reference state. In doing so, it was possible to define a chemistry-free reference state that involves the same mechanism in the corresponding enzymatic reaction. Second, the nature of the electrosatic contribution to enzyme catalysis was clarified by describing and quantifying the preorganization concept, demonstrating that enzyme active sites provide a preorganized polar environment that stabilizes the transition state much more than the corresponding environment in water. Finally, the proposal that the catalytic effect is primarily due to electrostatic effects was established by demonstrating that the contributions from other factors and proposals are relatively small.