In a large skillet over high heat, add bacon, onion and a pinch of pepper. Cook until bacon is crispy, about 5 minutes.
In a medium pot, add water, milk and a pinch of salt. Place lid on top and allow to come to a full boil. Add grits. Stir. When grits have almost absorbed all the water add cheese. Mix to allow cheese to melt and become creamy. Add bacon and onions and top with half of the scallions. Mix thoroughly.
Serve in a bowl and garnish with remaining scallions.