Heat is lost from the pipes carrying hot water from the boiler (or other heat generator) to the taps, and the resulting cooling means that a certain volume of water has to be run off before hot water reaches the outlet. Heat is also lost when storage for hot water is used. The delivery efficiency accounts for these processes.
If secondary circulation and/or storage losses are used, then the DHW delivery efficiency should be set to 1. Otherwise the losses are accounted twice.