Recent rain has provided a welcome boost to the water levels in the Lower Hunter's dams and sandbeds, prompting the government to ease water restrictions across the Hunter.
Minister for Water Melinda Pavey said residents would return to Level 1 restrictions from Monday, February 24. Level 2 water restrictions had kicked in on January 20.
The Level 1 restrictions were introduced in September 2019 for the first time in 25 years in response to the state's worst drought on record.
"It has been a welcome relief to receive some much needed rainfall and while local dams haven't made a full recovery, they are in better shape than previously," Ms Pavey said.
Speaking beside Grahamstown Dam, the Lower Hunter's largest drinking water source, in Raymond Terrace on February 18, Ms Pavey said the decision to bring the restrictions back to Level 1 was based on water level "trigger points" and the advice of Hunter Water experts.
As of Monday, Grahamstown Dam stood at 60.8 per cent, a 6.9 per cent increase in one month, Chichester Dam is at 100 per cent (up 61 per cent), Tomago sandbeds are at 63.6 per cent (up 7.2 per cent) and Anna Bay sandbeds 57 per cent (up 2.6 per cent).
The area's total water storage level on Monday was 63.8 per cent (up 10.3 per cent from the last month). It is expected storage levels will reach 65 per cent capacity by the end of the February.
"The Chichester catchment in particular has received decent falls, generating streamflow in the Williams River and causing Chichester Dam to spill," Ms Pavey said.
"Although this a positive step in our drought recovery, we are not out of the woods yet, which is why it's important that we all continue to use water wisely and save it wherever we can."
She added that the government would continue its research into infrastructure projects in the Lower hunter, including exploration into desalination plants and new dams.
Hunter Water's executive drought lead, Darren Cleary, said while the rise in water storage levels was a "step in the right direction", the utility needed to see a further increase before it was confident the Hunter had come through the severe drought.
"It's really important that our community continues to maintain the great water saving behaviours that they have demonstrated so far, which has helped us reduce consumption by 20 per cent compared with what we expected," he said.
"This amounts to the average water use of 70,000 households, which is an outstanding result.
"I encourage everyone to keep up the great work because we all have a role to play in conserving our precious resource and using it wisely."
Level 1 water restrictions permit outdoor watering before 10am and after 4pm with trigger nozzle hose and washing of vehicles with a bucket, trigger nozzle hose or pressure cleaner.