In order to eliminate the effects of frequency modulation depth, signal phase delay and intensity accompanying modulation on phase generated carrier demodulation approach using orthogonal terms (OT-PGC), a new PGC method is proposed based on fixed phase delay (FPD-PGC) introduced by 3×2 directional coupler. The second harmonics of two interferometric signals are used for demodulation. The demodulation principle of the new method is described in detail and its performances are studied. The harmonic suppression ratio (HSR) of the new method is increased by more than 30 dB compared with OT-PGC method under the condition of intensity accompanying modulation coefficient of 0.4 according to simulation. The signal-to-noise ratio (SNR) is also improved significantly. Experimental test shows the same result. Theoretical analysis and experimental results show that the new method eliminates the effect of signal phase delay and suppresses the impacts of frequency modulation depth and intensity accompanying modulation to a great extent.