Water is used to dilute lye crystals, and acts as a carrier for the lye. But, is it a part of the chemical reaction of saponification? When the oils are combined with lye the reaction produces soap, water and glycerin. Eventually the excess water is evaporated during the curing phase (This is when the soap is left to dry out).
The type of water used is very important. Tap water should not be used. Tap water contains minerals and impurities such as calcium, magnesium as well as organic material. Distilled water or pure(uncontaminated)rainwater is essential to the soap maker.
The process of making distilled water is very simple. The water is boiled and the steam is collected in a clean container. The theory behind distilled water is very basic - Regular water which is denser, is boiled - the lighter steam rises and is free of contaminants, and is then collected. The collected steam is distilled water. When regular undistilled water is used in soap making, the soap will readily bond to some of the minerals, which will decrease its cleaning action.
The amount of water that is used in a formulation is based on the amount of lye that is needed, not on the weight of the oils. Water is the one ingredient that does not have to be measured precisely. Because of this, recipes will have a range for the amount of water needed.
The pH of water is 7, and pH of lye is approximately 14. Increasing the water content will dilute the solution, which will decrease the pH of the lye solution. Decreasing the water content gives a more concentrated lye solution. Therefore, the alkali is made more strong the less water is in the recipe. This speeds up the saponification process and soap will trace more quickly. If you need to slow down the saponification process adding more water can buy you time. Why do you need more time? Some additives as well as some combinations of oils used will produce a faster tracing time and may even cause the mixture to seize and become difficult or impossible to pour.
Since saponification is an exothermic reaction (reaction that produces tremendous heat) using ice cold water will drop the temperature faster so you don't have to wait for the lye to cool down. But one has to be careful that the temperature is maintained above 110 Degrees Fahrenheit or so. If the temperature is too low it slows down the chemical reaction.
When using a more concentrated lye solution the lye will not dissolve easily so more stirring is needed. The lye sometimes will settle to the bottom so one has to make sure that all particles are dissolved in the water. The more concentrated the water/lye solution, the more damaging it can be to body tissue and equipment.
It is advisable to only do a water discount on soap recipes you have already tried since doing so will speed up the reaction and there are many unknown factors that will potentially cause the soap to seize, even to the point that it will be too thick to pour.
Soap with a higher water content will take longer to unmold and longer to dry out. I find that when using some additives I need to increase my water to prevent cracking. Some additives that will absorb some water in the mixture are - oatmeal, almond meal, milk, honey, sodium lactate, etc. With these additives one should never discount the water in the recipe.