Combine champagne, water, and powdered pectin in a flat bottomed kettle; bring to a rolling boil, stirring constantly. Add sugar; return to a rolling boil. Boil 1 minute, stirring constantly. Remove from heat; skim off foam.
Quickly ladle jelly into hot sterilized jars, leaving 1/4-inch headspace. Cover with metal lids, and screw bands tight. Process in boiling-water bath 5 minutes.