If you have fresh hatch chiles, rub them with a bit of oil, place on a sheet pan and broil on high until black and soft, flipping once. Place in a bag and seal (or put in a bowl and cover with plastic wrap) and let steam. Skin, stem, de-seed, and chop.
In a large sauce pan, melt the butter over medium heat. Stir in the flour and cook, stirring, until smooth, 1-2 minutes. Pour in the milk in a thin stream while whisking – it will be quite thick. Whisk in the water and add in the macaroni, stirring occasionally, until wisps of steam come up as you stir. Turn the heat down to medium low.
Stir occasionally as the pasta bubbles away, gently, for about 9-10 minutes, or until the macaroni is tender and the sauce starts to thicken. It should be quite liquid/saucy at this point as adding in the cheese will thicken it up.
Remove the pan from the heat and stir in the cheese and chopped peppers quickly. Season with salt and pepper and let stand for a couple of minutes. The sauce will thicken as it rests. Enjoy immediately!
