Combine chiles, garlic, sugar, salt, and vinegar in a small saucepan. Cover and heat gently, as if to steep, over very low heat for 30 minutes.
Add chile mixture and 1/4 cup hot water to a blender. Remove center piece of blender lid (to allow steam to escape); secure blender lid on blender. Place a clean towel over opening in blender lid (to avoid splatters). Blend until smooth, adding more hot water if necessary.
Store in refrigerator in an airtight container for 7 to 10 days. If sauce separates, give it a good stir or shake.
Fiery Hot Green "Sriracha": Nothing like the real thing, but searingly spicy and tangier. Preheat broiler to high. Place 8 ounces whole jalapeños and 1 (1/2-inch-thick) onion slice on a baking sheet; coat with cooking spray. Broil 5 minutes; turn vegetables. Add 4 garlic cloves; broil 5 minutes. Wrap mixture tightly in foil. Let stand 20 minutes. Peel and seed peppers. Place peppers, onion, garlic, 1/4 cup fresh lime juice, 1/4 cup water, 2 tablespoons sugar, and 3/4 teaspoon salt in a blender; process until smooth.
SERVES 16 (serving size: 1 tablespoon)
CALORIES 14; FAT 0.1g (sat 0g); SODIUM 111mg