The Waves filter is accessible in the Distort category in the Filters menu. The effect is of an image being distorted when viewed under ripples of water.
In the "Waves" dialog use the sliders to set the following in the Parameters box:
Amplitude The height of the waves between 0 and 100
Phase The point in the wave cycle in degrees between 0 and 360
Wavelength The wavelength between 0 and 50
All the changes are immediately shown in the Preview box.
See: