The dam level for the greater Sydney catchment — including a major reservoir in Warragamba — was near to 46.2 per cent on Wednesday. The Cataract Dam in the Upper Nepean was at 26.5 per cent.
Premier Gladys Berejiklian said a rapid decrease in dam levels had made the higher restrictions more urgent - they were due to come into force in February.
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"Usually,we would expect to have Level 2 water restrictions come into effect when dam levels reached 40 per cent,"Ms Berejiklian said.
"We’re experiencing one of the most severe droughts on record and we expect[the] restrictions to save 78.5 gigalitres of water per year."
The last time Sydney faced Level 2 water restrictions was during the devastating Millennium Drought.
The latest changes,approved by cabinet three weeks ago,will require gardens to be watered by a bucket or watering can between approved times.