Israel's large cities use an average of 4 percent more water, with the sharpest rise in Jerusalem, followed by Tel Aviv-Jaffa.
Several PM coalition partners have conditioned their support for the reform on Netanyahu supporting their pet projects.
The battle against companies making false claims of environmental friendliness has been boosted by a new government campaign.
Common grasshopper warbler spotted near Eilat - the first time in 30 years the small insect-eating bird has been spotted in Israel.
Bat Yam, Eilat, Herzliya and several other cities join project aimed at recycling two-thirds of household containers within three years.
The measure brings Israel into line with European standards.
Environmental activists are working to remove fishing nets from the Gulf of Eilat, claiming they are death traps for sea life.
While development at natural springs can make them more tourist-friendly, environmentalists caution that it can also lead to their destruction.
Critics say plan is not enough to clean our air.
According to Geological Survey of Israel, several hundred sinkholes appear every year, some as large as 12 meters in diameter and 20 meters deep.