Investments

Keydata Income VCT 2
                  

                       Keydata Income VCT 2 plc

                           RNS Announcement

                              Investments

The Company is pleased to announce that it has entered into investment
commitments in respect of ten Scottish windfarm companies, the principal terms
of which are as follows:

1 The Company will be investing an aggregate of £4,000,000 in ten newly formed
    companies, incorporated in England & Wales, (each a 'Windfarm Investment
    Company'). It is intended that each Windfarm Investment Company will own and
    operate one wind turbine. The Company will invest £400,000 in each Windfarm
    Investment Company by way of subscription for shares and variable rate
    unsecured loan notes.

2 At the time of investment, each Windfarm Investment Company will have
    conditionally agreed to acquire from a subsidiary of Falck Renewables
    Limited ('Falck') a company established to construct and operate a one
    turbine windfarm in Scotland ('Project Subsidiary').

3 Falck is presently developing, through its subsidiaries, a number of windfarms
    in Scotland ('Windfarms'). Each Windfarm is at a different stage of
    development with construction start dates currently targeted from August
    2006. In each case, Falck has secured land rights on which it is proposed
    that a Windfarm will be constructed. Planning permission has been granted in
    respect of two of the Windfarms (for a total of 26 wind turbines) and
    planning permission is being sought for a further 33 wind turbines on two
    additional windfarms.

4 Once the board of the relevant Windfarm Investment Company has carried out
    satisfactory due diligence on the relevant Windfarm and resolved to proceed
    and subject to the satisfaction of other conditions set out in the relevant
    share purchase agreement, the Company will provide further funding to the
    Windfarm Investment Company to enable it to complete the purchase of a
    Project Subsidiary and to fund the construction of the Windfarm by that
    Project Subsidiary. Such further investments will be made through a
    combination of paying-up unpaid amounts due on shares, subscription for
    further unsecured variable rate loan notes and zero coupon deep discount
    bonds. The precise amount of the further investments will depend on the
    final project costs together with costs and fees required to be paid for
    development and the sale price of the shares of the Project Subsidiary to be
    acquired by the relevant Windfarm Investment Company. The Company will be
    providing only a proportion of the total funding required by the Windfarm
    Investment Company, any shortfall to be sourced from third parties including
    Keydata Income VCT 2 plc and Falck.

5 Completion of the acquisition of the relevant Project Subsidiary will only
    proceed once the Project Subsidiary has acquired all the necessary rights to
    enable it to construct, own and operate the relevant Windfarm. An affiliated
    company of Falck will provide services for the technical and commercial
    operation of the Windfarm on behalf of the Project Subsidiary and the
    Project Subsidiary will enter into a long term power sales agreement with a
    Falck group company for the Windfarm's output and related products.

6 Green Power 2 Limited, the investment manager of the Company, will also
    provide construction and operational management services to each Project
    Subsidiary under the terms of a Project Subsidiary Management Contract for
    which it will receive an annual fee of 0.25% of the amount invested by the
    Company in the Windfarm Investment Company that owns the relevant Project
    Subsidiary plus VAT (escalating at UK CPI).

The above investment structure is in line with the investment strategy outlined
in the Company's prospectus issued on 15 December 2005.