FAIRFIELD, NJ, February 8, 2006 - Covanta Holding Corporation (NYSE: CVA), has announced the execution of contracts with Lee County, Florida to manage the construction of a 636 TPD (ton per day) capacity expansion to Lee County's 1,200 TPD waste-to-energy facility located in Fort Myers, and to extend Covanta's current service agreement to operate and maintain the expanded facility.  Covanta's subsidiary constructed and has been operating the existing facility since 1994.  Construction of the expansion is now underway and is expected to be placed into operation in 2007.  The facility serves as an integral component of the comprehensive solid waste management plan of Lee County, which includes recycling, composting, waste-to-energy and landfilling.

Covanta's service agreement, which was set to expire in 2014, has also been amended to include the expansion, and extended for an additional 10 years until 2024.  Throughout the term of the extended agreement Covanta will operate and maintain the facility to deliver environmentally-sound waste disposal and clean, renewable energy.

"It is encouraging to once again see construction of modern waste-to-energy disposal capacity as a critical component of a community's integrated solid waste management plan.  Lee County's decision to expand its facility reinforces the strategic role waste-to-energy plays in recovering energy and materials from the wastestream in an effort to further reduce reliance on landfilling.  We look forward to continuing our long-standing partnership as we work with the County to complete the expansion of their facility." said Anthony J. Orlando, Chief Executive Officer of Covanta.
 
The Lee County facility's existing two boiler units, utilizing the proprietary combustion grate and controls technology of Martin GmbH, annually process over 372,000 tons of residential and commercial solid waste generated in the County.  Waste is converted first to steam and then to electricity which is sold by Lee County to Seminole Electric Cooperative. With the expansion which includes the addition of a third boiler unit, also featuring Martin technology, the facility's capacity will increase by 50%

About Covanta Holding Corporation:
Covanta Holding Corporation, formerly Danielson Holding Corporation, is a New York Stock Exchange listed company engaging in waste disposal, energy services and specialty insurance through its subsidiaries. Covanta's subsidiary, Covanta Energy Corporation, is an internationally recognized owner and operator of waste-to-energy and power generation projects.  Covanta Energy's waste-to-energy facilities convert municipal solid waste into renewable energy for numerous communities, predominantly in the United States.

NOTE:  Covanta's charter contains restrictions that prohibit parties from acquiring 5% or more of Covanta's common stock without its prior consent.

CAUTIONARY NOTE REGARDING FORWARD LOOKING STATEMENTS
Certain statements in this press release may constitute "forward-looking" statements as defined in Section 27A of the Securities Act of 1933 (the "Securities Act"), Section 21E of the Securities Exchange Act of 1934 (the "Exchange Act"), the Private Securities Litigation Reform Act of 1995 (the "PSLRA") or in releases made by the Securities and Exchange Commission, all as may be amended from time to time.  Such forward looking statements involve known and unknown risks, uncertainties and other important factors that could cause the actual results, performance or achievements of Covanta and its subsidiaries, or industry results, to differ materially from any future results, performance or achievements expressed or implied by such forward-looking statements.  Statements that are not historical fact are forward-looking statements.  Forward looking statements can be identified by, among other things, the use of forward-looking language, such as the words "plan", "believe", "expect", "anticipate", "intend", "estimate", "project", "may", "will", "would", "could", "should", "seeks", or "scheduled to", "proposed", or other similar words, or the negative of these terms or other variations of these terms or comparable language, or by discussion of strategy or intentions.  These cautionary statements are being made pursuant to the Securities Act, the Exchange Act and the PSLRA with the intention of obtaining the benefits of the "safe harbor" provisions of such laws.  Covanta cautions investors that any forward-looking statements made by Covanta are not guarantees or indicative of future performance.  Important assumptions and other important factors that could cause actual results to differ materially from those forward-looking statements with respect to Covanta, include, but are not limited to, those factors, risks and uncertainties that are described in Item 1 of its Annual Report on Form 10-K for the year ended December 31, 2004, as amended, and in other securities filings by Covanta or its subsidiaries.                              

Although Covanta believes that its plans, intentions and expectations reflected in or suggested by such forward-looking statements are reasonable, actual results could differ materially from a projection or assumption in any forward-looking statements.  Covanta's future financial condition and results of operations, as well as any forward-looking statements, are subject to change and inherent risks and uncertainties. The forward-looking statements contained in this press release are made only as of the date hereof and Covanta does not have or undertake any obligation to update or revise any forward-looking statements whether as a result of new information, subsequent events or otherwise, unless otherwise required by law.

For more information generally, please contact:

Elizabeth O'Melia
973-882-4193

Doreen Lubeck
773-583-4331