It depends. To my knowledge, low-power mode:
- Disables automatic fetching of mails (not sure about push), i.e. you need to open Mail the get mail updates
- Disables background app refresh and background downloads (perhaps some other background activity too)
- Disables many animations and animated wallpapers
- Lowers the screen brightness
- Limits networking speed (maybe other things too, like GPS-fixing frequency)
Now it also seems to throttle the processor. It depends on whether you can use your iPhone without those features on a frequent basis. I think it's good that Apple offers a toggle to disable many energy-consuming features quickly without having to dig into or even know about those features.
I found that disabling Wi-Fi and Bluetooth rarely has an impact on battery life, at least in my case. The biggest battery drain is the screen itself as well as foreground activity. The iPhone has a fantastic battery life when you only frequently use your phone to check and respond to messages, rather than keeping it on for prolonged periods of time. It can easily last two days or more that way. I know of many phones that are extremely leaky when it comes to standby battery usage.