This effect allows you to do Chroma Keying (Chroma key compositing/Green Screen) on Kdenlive. That is you can use the Blue Screen effect to generate alpha channel information allowing two video tracks to be combined using the Composite transition.
|Alternatively you can combine two video tracks together using the screen transition (if one of them is filmed on a black background).|
Youtube video on Chroma Keying which uses the Blue Screen effect
Another video on chroma keying / green screen. This one also shows you how to use rotoscoping to remove stuff you do not want from out of your frame. It also means you don't need to fill your whole frame with the green screen either.
Tutorial showing how to use the "Blue screen" function and keyframes to animate one image moving over another in the Kdenlive video editor
See also keysplillm0pup effect in the Misc group. The keyspillm0pup effect can be used to improve the edges of the blue screen effect - when edge problems are caused by "keyspill". Keyspill is when the color of the screen used for colorkeying spills onto the subject due to light reflection.
See also Color Selection which also does color based alpha selection.
see this thread for some discussion on chroma keying issues in Kdenlive