In a large saucepan, bring the water and milk to a boil.
Whisk in the grits to prevent any lumps. Reduce the heat to low, cover, and simmer, stirring frequently to prevent sticking, for about 20 to 25 minutes until the grits are thickened and tender.
Remove from heat and stir in the cheddar cheese, butter, salt, and black pepper until smooth and creamy. Cover and set aside.
Prepare the Fish
In a small bowl, mix paprika, onion powder, garlic powder, salt, and black pepper.
Season both sides of the fish fillets with the spice mixture.
Heat a large skillet over medium heat and add enough olive oil to coat the bottom. Once the oil is hot, add the fish fillets. Cook for 3 to 4 minutes on each side or until the fish is golden and flakes easily with a fork. The exact cooking time will depend on the thickness of the fillets.
Spoon the creamy grits onto plates or into bowls. Top with the cooked fish fillets.
Serve with lemon wedges for squeezing over the fish.
Notes
For the fish, ensure your skillet is hot before adding the fillets to get a nice sear.
If you prefer, you can add other seasonings to the grits, like a pinch of cayenne for heat or some chopped herbs for freshness.