Yes, they need excellent drainage like any other container would. (think of all the rain and snow they'll be exposed to). I use no screw on cap on the jugs, and usually cut an extra vent or two in the top. You might not need extra vents in top if you live in a northern place with cool springs, or keep jugs in shade. But if they're in sun, heat can build up fast in warm weather, so I like to pre-cut a vent or two.
Best way to avoid overheating, don't keep them in full hot afternoon sun, and flip open after germination when temps are warm. When weather gets hot, just chop off the lid.
Besides Critter's article, Lynn did one too, which is a "sticky" on the seeds forum.
http://garden.org/ideas/view/v...
Karen
Really, sometimes it's just wise to adapt to your weather each year. In a cold spring, full sun might work great. In a particularly hot year, dappled shade, or only morning sun might be better. Everybody has their challenges and they tend to change yearly. 
What sun. Mabe one or 2 days in January. I'll cut a few vents. I have holes drilled for drainage but thought the open top and places were it is not taped would vent them.
