The generation of a split-frequency is inherent to heterodyne displacement interferometry. Currently this split-frequency is predominantly generated by either acousto-optic modulators (AOM), Zeeman-lasers (ZL), or a combination. Both techniques have their drawbacks, e.g. AOM have a limited bandwidth and are optically inefficient due to a loss of optical power in various unused diffraction orders. Whereas the optical output power of a Zeeman-laser decreases rapidly as the split frequency is increased. This publication presents a third method to generate split-frequencies for heterodyne displacement interferometry, making use of an electro-optic rotating quarter wave-plate. Using this technique, the split-frequency is tunable, optical power is preserved, and the technique has potential to generate split-frequencies of several MHz. Moreover, this publication contains a complete review of frequency-modulation using rotating mechanical- and electro-optic wave-plates. The rotating electro-optic quarter wave-plate is implemented in a heterodyne displacement interferometer and compared to state-of-the-art split-frequency generation techniques in terms of periodic non-linearity (PNL). Experimental results showed a first order PNL of 2.7nm obtained with the presented electro-optic split-frequency generator, in contrast to 1.6nm and 0.18nm for the ZL and AOM respectively.