The NSW Government has committed $1 billion to help rebuild bushfire-ravaged communities, as authorities confirmed blazes have destroyed 1,870 homes around the state this season.

Key points: The money is on top of $200 million already committed by the NSW Government

The money is on top of $200 million already committed by the NSW Government It will be spent on infrastructure

It will be spent on infrastructure The NSW Treasurer said he wanted fire-impacted communities to "thrive"

NSW Premier Gladys Berejiklian announced the cash injection this morning, and said her Government was "stepping up".

The money will go towards repairing and rebuilding damaged infrastructure such as roads, rail lines, bridges, schools, health clinics and communications facilities.

It comes on top of more than $200 million already committed by the State Government, and a $2 billion national fund provided by the Federal Government.

"Of course, we are always standing shoulder to shoulder with those impacted by this devastating catastrophe that's come to New South Wales," Ms Berejiklian said.

"We are stepping up to the support."

The Premier said her Government's money would be used for infrastructure, while the Federal cash would go directly to people.

"It's been determined that the Federal Government's contribution, our [state's] share of the $2 billion, will go towards direct payments, to individuals, local businesses or councils," she said.

Firefighters are preparing for another challenging day tomorrow. ( ABC News: Brendan Esposito )

The figures come as the NSW Rural Fire Service (RFS) confirmed 1,870 homes have been razed by bushfires this season — a number likely to rise as assessments continue.

The RFS said a further 753 homes had been damaged this season.

Prime Minister Scott Morrison on Monday announced his Government would commit an additional $2 billion over two years to set up a new national bushfire recovery agency.

The agency will be led by former Australia Federal Police commissioner Andrew Colvin.

That investment is in addition to existing assistance available, such as income replacement payments and support from the Defence Force.

NSW Treasurer Dominic Perrottet said the NSW Government was committed to helping fire-affected communities.

"We don't want simply to rebuild the communities, we want them to thrive, and this $1 billion investment will do just that," he said.

"We know that this won't happen overnight's that this will take time and those who are affected, we say to you that we have your back now and well into the future."

Fire crews have been taking advantage of cooler conditions this week to prepare for another challenging day tomorrow, with hot weather expected in several areas.

Bureau of Meteorology acting state manager Grahame Reader said temperatures were set to be around the low 40s tomorrow, reaching the mid-40s in Western Sydney, with strong winds stoking fire danger.

"After a relative respite in the weather this week, we are expecting another significant spike in conditions tomorrow," he said.

Hot and dry north-westerly winds will move to a vigorous southerly change in the afternoon, bringing with it gusts of up to 90 kilometres per hour.

Fire danger will reduce over the weekend but the smoke that has been lingering all week is unlikely to dissipate, he said.