The power levels of warriors and mages are as follows: Novice < Intermediate < Elite < Master < Professional < Sovereign. Each level is further divided into four stages: Beginner < Elite < Advanced < Peak.
For example, during the Erebor expedition, Gandalf was at Master - Peak level, whereas during the War of the Ring, when he became the White Wizard, he was at Professional - Intermediate.
Galadriel, on the other hand, was at Professional - Advanced.
Dragons exist in this story, and the strongest among them are at Sovereign - Peak level. However, I might introduce a separate ranking system for beasts.
The gap between Professionals and Sovereigns is similar to the difference between Uchiha Madara and the Kages—meaning, Sovereigns are in a completely different league.
This world uses two primary energy sources: Mana and Aura.
Mana is an external force, used by wizards, shamans, druids, and necromancers.
Aura enhances the physical strength of warriors and rangers. It can be used to amplify one's voice, exert pressure on enemies, and increase the destructive power of weapons like swords and arrows.
There are still some uses I haven't fully decided on.
Elemental powers will also play a role in this story! If you're curious, keep reading!