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Performance degradation assessment has emerged to realize equipment’s near-zero downtime and maximum productivity. Exploring effective indices is crucial for it. In this study, taking rolling element bearing as a research object, cyclic energy indicator is proposed for its performance degradation assessment. The proposed cyclic energy indicator is based on signals’ cyclic coherence analysis and its variation with the damage extent of the rolling element bearing is verified through simulation and seeded fault experimental data. Then an accelerated life test of the rolling element bearing is performed to collect vibration data over the whole life time (normal-fault-failure). Results of both simulation and experiments show that the cyclic energy indicator is an effective index for the degradation assessment of rolling element bearings.