The Distortion Sprite needs to be on the top layer, and you can use just a simple square sprite found in Unity 2D Sprite. Your ground should be a different sprite renderer placed on the base layer, and this distortion shader sprite to be placed on top of it. Now anything below the distortion shader sprite would look a bit distorted or wavy in nature. Furthermore, you can scale this sprite as per your needs and also tweak settings to get the desired result for your game. Hope this helps!