Sydney ushered in the new year with a bang and a whimper. As thousands of fireworks shot into the sky over the harbour city, revellers donated $2 million to help communities devastated by bushfires.

The City of Sydney council pushed ahead with its $6.5 million New Year's Eve celebrations amid calls for the famous fireworks displays to be cancelled due to the deadly bushfires ravaging parts of NSW.

"I think we're starting 2020 in a very sombre mood," Sydney lord mayor Clover Moore said on Wednesday morning. "Yesterday and last night's fires across NSW were truly shocking."

Three people are dead, a fourth person is unaccounted for and hundreds of homes have been destroyed following a horrific day for fires on the South Coast.