Preheat oven to 375 degrees F. Lightly grease a cookie sheet; set aside. In a small bowl, combine flour and baking powder; set aside. In a large bowl, beat butter with an electric mixer on medium to high speed for 30 seconds. Add sugar, tarragon, lemon peel, and salt; beat until combined. Beat in egg until combined. Beat in as much of the flour mixture as you can with the mixer. Using a wooden spoon, stir in any remaining flour mixture and the nuts. Divide dough in half.
Shape each half into an 11-inch-long loaf. Place loaves about 5 inches apart on prepared cookie sheet. Flatten each loaf slightly until 2 inches wide.
Bake for 20 to 25 minutes or until light brown. Cool loaves on cookie sheet about 1 hour or until completely cool.
Preheat oven to 325 degrees F. Transfer loaves to a cutting board. Cut each loaf diagonally into 1/2-inch-thick slices. Lay slices, cut sides down, on cookie sheets. Bake in the 325 degrees F oven for 10 minutes. Turn slices over and bake for 10 to 12 minutes more or until dry and light brown. Remove and cool on wire racks.