In a large bowl, cream butter and 2 cups confectioners' sugar until fluffy. Beat in eggs one at a time, beating well after each addition. Stir in flour and vanilla, then pecans and lemon peel. Turn batter into greased 9 inch tube pan.
Bake at 325 degrees F (165 degrees C) for 40 to 45 minutes, or until done. Cool. Remove cake from pan, and invert onto serving plate.
Make glaze by mixing 1 cup sifted confectioners' sugar with fresh lemon juice. Drizzle over cake.