Distortion shader for LWRP with 2d Renderer selected (not forward renderer)

Hi,
I'm struggling for several hours trying to figure out how to do distortion in 2d game.
I was following this movie (

) which shows how to enable 2d lights for LWRP. All was great, I can put lights as I want, but I'm unable to create shader for water. I tried all tutorials and movies on YT which I was able to find and only effect which I got was grey box. I tried to put material both on mesh and on sprite, switched all types of shader (Lit/unlit/sprites) and stuck.
I'm using unity 2020.2.1f1 with Lightweight RP 10.2.2.

Can anyone suggest any tutorial/doc where I can find how to achieve distortion with 2d pipeline?