Water can be a problem in Story of Seasons: Pioneers of Olive town, especially when it comes to trying to drain an entire lake. Yes, you get a bucket, but this is not a viable way to drain a lake. It is fine for puddles, and even small ponds, but that is it.
To drain a lake, you will need a water pump. The first thing you will need to do is get your draining level to 5. You can do this by draining ponds and puddles, and letting it build over time. There is no real way to specifically farm it without wasting lots of time, so just let it come naturally over the course of play.
Once you have the recipe for the water pump, you will need to make it in the crafting menu using 10 bricks and five silver ingots. You can make bricks by putting clay in a brick maker, and you can make silver ingots by putting silver ore into the ingot maker. When the water pump is complete, place it beside the lake to set it to work.
You will need one piece of coal a day to power the pump, as it is not a magical device and needs some fuel. You can find coal in veins on the walls of the caves, or you can sell a single piece of coal and the General Store will start to stock it.
Now, the big question. Why would you even drain a lake? The main reason to do it is to get the treasure that can be found at the bottom. This can often be taken to the museum, or sold for plenty of cash.