What is the meaning of nil owner in component constructor

Question

I was looking at this question and I'm wondering now, what is the meaning of nil as the owner in component constructor.

SomeComponent := TSomeComponent.Create(nil);

I know, that I should free it by myself when using this constructor, but is that the only reason to pass the owner at creation ? And what happens, when I forget to free it and close my application - does it mean that this object remains in memory as a garbage ?

Thanks a lot :)