Recent observations report a discrepancy between observed energy dissipation rates and lee wave pressure flux predicted by linear theory in the Southern Ocean, raising the possibility that wave energy re-absorption by mean flows may be an important route to wave energy sink. Here we investigate the sink of lee waves in the northern South China Sea in a high-resolution nested model initialized with a synthetically-generated rough topography. Our results indicate that wave dissipation is the dominant sink of lee wave energy, with wave energy re-absorption being of secondary importance. The dominant direction of energy transfer is from mean flows to lee waves through vertical shear and horizontal strain of mean flows. A series of idealized experiments suggest that the weak wave energy re-absorption in the northern South China Sea is primarily due to the large Froude number there.