The state recorded zero new local cases in the 24 hours to 8pm on Thursday, the fifth consecutive day without local transmission.

One case was uncovered in a traveller in hotel quarantine.

Barring the Cumberland local government area, all Greater Sydney LGAs - as well as Wollongong and Blue Mountains - will from 6pm on Friday be downgraded to "orange" on Victoria's health alert system.

People travelling to Victoria from an "orange" zone will need to apply for a permit, get tested within 72 hours of their arrival and isolate until they receive a negative result. However they will not be barred entry.

The Cumberland LGA takes in Berala, the centre of a 35-person virus cluster, and its residents will remain locked out of Victoria.

Some 25 of Greater Sydney's 35 LGAs had already been downgraded by Victorian authorities from "red" to "orange".

Elsewhere, regional NSW has been downgraded to "green" by Victoria, meaning residents and returning travellers are completely free to cross the border.

"It will be welcome news for many people who want to get home and have had a summer that has been somewhat disrupted, and in some cases more than that," Premier Dan Andrews told reporters on Friday.

Friday's NSW case tally came from almost 17,500 tests - higher than would have otherwise been the case due to Thursday's IT delay on 6000 negative tests. Those tests have been included in Friday's numbers.

Despite the good news, NSW Health's Dr Jeremy McAnulty on Friday again implored the state's residents to get tested with even mild symptoms.

"Testing rates just aren't high enough right now," he said in a statement.

"High testing rates help reveal cases that would otherwise go undetected."

His plea comes after fragments of the virus were detected at a waste water plant in Warriewood, which takes in a catchment of more than 160,000 people on the northern beaches, as well as Auburn, Camellia and Glenfield.

Authorities suspect the fragments may be the result of recent local cases.

Health Minister Brad Hazzard on Friday told 2GB radio that authorities would continue to take a cautious approach, and reiterated gathering restrictions in Greater Sydney would not be eased before Australia Day.

"This virus, we've all had our hopes dashed, our hearts broken when we've got to a point where we've thought, 'Oh, yep, this is doing really well'," he said.

Australian Associated Press