It doesn’t defeat it. I expect a browser extension—whose job it is to rewrite URLs—to be able to rewrite URLs. But I don’t expect HTTPS Everywhere to want access to my camera, or to my filesystem, or to the microphone. So I allow the first one, and get very worried if I’m ever even asked about any of the others.

Another browser extension might want to automatically save images I come across to a directory. That one would prompt for access to my Documents folder. It wouldn’t request URL rewrite privileges, or camera, etc.

EDIT: So to answer your question, what is “something”? In this case, that would be: “HTTPS Everywhere wants to be able to edit the web addresses you visit”. Or something like that.