Hi keaty1984,
There is a problem with the latest Nvidia driver. If you follow the instructions in the attached thread you will solve the problem with the water effect. You must re-install the earlier driver from Nvidia.
http://forum.shipsim.com/index.php/topic,29823.msg391395.html#msg391395
If you have bought the game via Steam you must enter TWO keys , the Vstep one AND the one from Steam.
Regards,
Angus.