How to change query_cache_type to 2 in AWS RDS?
Have you attached the parameter group to the RDS instance properly? I have just checked on my installation, and things are working as expected. (Note, I do have my cache size set to zero, as for our workload it is not beneficial to enable it)

Parameter Group Settings


MySQL Query Cache

mysql&gt; show global variables like 'query_cache%';
+------------------------------+--------+
| Variable_name                | Value  |
+------------------------------+--------+
| query_cache_limit            | 0      |
| query_cache_min_res_unit     | 512    |
| query_cache_size             | 0      |
| query_cache_type             | DEMAND |
| query_cache_wlock_invalidate | OFF    |
+------------------------------+--------+
5 rows in set (0.01 sec)


Parameter Group Assigned to RDS Instance



Regards,
Dave