The alpha channel is a black & white image containing information about where a specific object exists and where it does not. White in the alpha represents an object, black represents empty space. It is useful as a clipping mask when you want to isolate an object and composite it with another object (for example: clipping a car render and pasting it over a photograph).
Opaque option
With transparent objects the alpha normally takes into account the amount of transparency of the object and renders with varying degrees of grey - for example very dark grey for very transparent objects. It is possible to render a completely white alpha also for transparent objects with the Opaque option. This can be useful if you want to maintain the full look of the transparency from the render, instead of blending it with any other images in your composite. 
From left to right: Render, Alpha with opaque option OFF, alpha with opaque option ON
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