Preheat oven to 350 degrees F (175 degrees C). Place the squash cut side down into a baking dish. Pour water into the dish to about 1/4 inch deep.
Bake in preheated oven until the squash pierces easily with a fork, about 30 minutes.
Meanwhile, blend the butter with the lime juice and chili powder in a small bowl. Mix in the lime zest, if desired. Season to taste with salt and pepper. Spoon the butter mixture into the cooked squash, and serve immediately.