How much water do you add to make the sauce?

Good question, since the writer seems to have omitted that from the list. Since the water is being used to make the butterscotch sauce, it's purpose is just to help dissolve the sugar more quickly. I don't imagine you would need more than a few tablespoons' worth at the most. It will have to evaporate so the sugar can caramelize and the sauce thicken up, so you wouldn't want much to start with. And you can always thin the sauce down with more water if you want or need to later.