Using three-dimensional magnetohydrodynamic simulations we investigate energy release and transfer in a three-dimensional extension of the standard two-ribbon flare picture. In this scenario, reconnection is initiated in a thin current sheet (suggested to form below a departing coronal mass ejection) above a bipolar magnetic field. Two cases are contrasted: an initially force-free current sheet (low beta) and a finite-pressure current sheet (high beta), where beta represents the ratio between gas (plasma) and magnetic pressure. The energy conversion process from reconnection consists of incoming Poynting flux turned into up- and downgoing Poynting flux, enthalpy flux, and bulk kinetic energy flux. In the low-beta case, the outgoing Poynting flux is the dominant contribution, whereas the outgoing enthalpy flux dominates in the high-beta case. The bulk kinetic energy flux is only a minor contribution in the downward direction. The dominance of the downgoing Poynting flux in the low-beta case is consistent with an alternative to the thick target electron beam model for solar flare energy transport, suggested recently by Fletcher & Hudson, whereas the enthalpy flux may act as an alternative transport mechanism. For plausible characteristic parameters of the reconnecting field configuration, we obtain energy release timescales and energy output rates that compare favorably with those inferred from observations for the impulsive phase of flares. Significant enthalpy flux and heating are found even in the initially force-free case with very small background beta, resulting mostly from adiabatic compression rather than Ohmic dissipation. The energy conversion mechanism is most easily understood as a two-step process (although the two steps may occur essentially simultaneously): the first step is the acceleration of the plasma by Lorentz forces in layers akin to the slow shocks in the Petschek reconnection model, involving the conversion of magnetic energy to bulk kinetic energy. However, due to pressure gradient forces that oppose the Lorentz forces in approximate, or partial force balance, the accelerated plasma becomes slowed down and compressed, whereby the bulk kinetic energy is converted to heat, either locally deposited or transported away by enthalpy flux and deposited later. This mechanism is most relevant in the downflow region, which is more strongly governed by force balance; it is less important in the outflow above the reconnection site, where more energy remains in the form of fast bulk flow.