How burning more fat translates into performance
The more fat you can burn, the more carbohydrate you save. The more carbohydrate you save the more likely it is that you will still be able to push some good wattage deep into your event.
You can achieve this carbohydrate saving by having a strong tempo ability. Take a look at the graphic below - a comparison of two riders with the same threshold ability, but different abilities at tempo. Imagine the two riders riding over a series of hills.
As the riders go over the hills they push more wattage, and as they do that they change the fuel (fat or carbohydrate) used to produce that wattage. Rider A is able to burn "mainly fat" for longer. Rider B spends significant time "burning more sugar". When they get to the end of the hills Rider A will have burned less carbohydrate/sugar than Rider B. With more sugar left in their system Rider A will be able to put out more peak wattage - which requires sugar as a fuel source - to outperform Rider B, who's depleted sugar reserves will limit their performance. This is when the difference between the riders becomes apparent and a split in the event or race occurs.
Don’t think that the only numbers that matter are what you can push as a max wattage. You need to make as much of your riding sustainable and in that fat burning area as possible. This means a good tempo ability, which will underpin your ability to push when needed.