Melt the butter or margarine in a small skillet over medium heat. Add the pepper and onion. Cook over medium heat about 5 minutes or until vegetables are tender. Stir in the brown sugar, mustard, and caraway seed. Add the drained sauerkraut and toss to mix.
Fold a 36x18-inch piece of heavy foil in half to make an 18-inch square.
Place the sauerkraut mixture in the center of the foil square. Bring up opposite foil edges and seal with a double fold. Fold in the remaining foil edges to completely enclose the sauerkraut mixture, leaving some space in the packet for steam to build.
Prick bratwurst in several places with a fork or tip of a sharp knife.
For a charcoal grill, arrange medium-hot coals around a drip pan in a grill that has a cover. Test for medium heat above the drip pan. Place the bratwurst and the foil packet with sauerkraut mixture on the grill rack over the drip pan. Cover and grill for 20 to 25 minutes or until bratwurst juices run clear, turning once.
For a gas grill, preheat grill. Reduce heat to medium. Adjust for indirect cooking. Place bratwurst and foil packet on grill rack; cover and grill as directed in step 5.
Serve brats in the buns and top with the sauerkraut mixture. Makes 6 servings.