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I just posted this over in the pepper forum but thought it deserved repeating here since it's such a favorite of ours.
Here's a recipe I've used successfully for several years, often substituting colorful strips of 'Gypsy' peppers or 1/4 inch rings of banana peppers for the green pepper strips in the original recipe. The jars of pickled peppers are beautiful, and they do retain a good amount of crunch -- about the same for the banana peppers as for the thicker walled bell peppers. We probably go through these faster than anything else in the canning pantry; they are just that good! If you have wide mouthed canning jars, it will be a little easier to pack the peppers.
Pickled Sweet Pepper Strips
slightly adapted from _The Joy of Pickling_ by Linda Zeidrich
4 thin slices fresh ginger
4 small garlic cloves
2 tsp. pickling salt (leave this out if you do an ice brine)
2 pounds sweet peppers, seeded and cut into 1/4 or 1/2 inch strips or rings
2 cups white wine vinegar (could substitute distilled white vinegar, but flavor will be a little harsh)
2 cups water
1 1/4 cups sugar
1. Put 1 ginger slice, 1 garlic clove, and 1/2 tsp pickling salt into each of 4 pint mason jars. Pack the pepper strips snugly into the jars.
2. In a nonreactive saucepan, bring to a boil the vinegar, water, and sugar, stirring until the sugar is dissolved. Reduce the heat, and cover the pan. Simmer the liquid, covered, for 5 minutes.
3. Pour the hot liquid over the pepper strips, leaving a 1/2 inch headsace. Poke around with a chopstick to get air bubbles out if needed. Close the jars with hot two-piece caps. In a boiling water bath, process the jars for 10 minutes.
4. Store the cooled, sealed jars in a cool, dark, dry place for at least 3 weeks before eating the peppers.
Edited to say that we like to add one small, whole chile pepper or a couple of thin slices of jalopeno to each jar for a little extra zing.
*** UPDATE: try the ice brine method!
These are still my favorite pickle! I looked at my original post at the top just now and realized I have an update... I now use an "ice brine" before packing the peppers into jars, and they turn out a little crunchier.
Toss the pepper rings/strips with pickling salt, about 1 Tablespoon per pound of peppers. Top with ice cubes, enough to generously cover the peppers in whatever bowl you're using (I'm trying to make this adaptable to different size batches, as I often do a double or triple batch of brine.. a couple of standard ice cube trays would be plenty for a single batch).
Let stand 3-4 hours (most of the ice will melt, but they should stay chilly), then drain & rinse before packing into jars.
Omit the salt from the pickling liquid if you use this method.