The most important function of the water is to keep the wheel clean while in use. It carries away grinding wheel dust and metal particles. It also lubricates and cools as others have said.For fair disclosure, I do not own a Tormex. I assume the water trough is there to wet the wheel thereby keeping the steel being ground cool. Other than that, I can't imagine what the water would be for.
I find it very easy to remove the tank and clean it out after every sharpening session.