The IBAA facility will have the capacity to process up to 250,000tonnes of incinerator bottom ash (IBA), a by-product of the incineration of residual waste, every year.
IBA is a safe "aggregate-like material" which, once processed, is commonly used by the construction industry.
Covanta's preferred partner for the IBAA facility is Ballast Phoenix, which operates on seven UK sites and processes more than 650,000tonnes of IBA per year.
Malcolm Chilton, UK managing director of Covanta Energy said: "We are delighted that we have received planning permission from the council to build this facility. This ensures the IBA will be recycled and not sent to landfill. Furthermore as the IBAA facility will be located within Ince Park alongside our EfW facility, transportation will be kept to a minimum helping to provide an even more sustainable solution."
David York, managing director of Ballast Phoenix said: "By developing an on-site IBAA facility, Covanta is ensuring that the IBA produced from the EfW facility can be managed in the most sustainable way providing a source of alternative aggregate for construction and infrastructure developers in the north-west. Furthermore, the facility will create up to 11 full time jobs."