If i remember correctly it has something to do with what's going on in your liver. It makes your BG drop quickly, after an initial high.
Biology lesson, for whoever's interested:
your liver has 2 jobs. It give you basal sugar at a relatively constant rate (except when you're sick, stressed, etc) and it filters toxins. It does both using the same metabolic pathways, which means that it can't filter toxins at the same time as giving you sugar. Alcohol is a toxin, so when you drink, your liver stop puttiung out sugar while it filters the alochol out (which takes somewhere around one hour per drink). In a normal pancreas-ed body, the pancreas responds to dropping glucose levels by putting out less insulin. When your pancreas is a pump or a long lasting shot, you have to do the reduction yourself in order to keep from going low, or you have to compensate with carbs.
The scariest part about alcohol is it interrupts the pathway for glucagon to work as well - so if you go low and pass out and your friends try to give you glucagon, it probably won't work, because your liver will probably still be busy trying to filter those toxins, and not "listening" for the glucagon.
You can also end up low several hours after your liver has finished processing the alcohol (which can be several hours after you stop drinking) because your body is trying to replenish the glycogen stores. The same thing happens with exercise.
Severe lows are a serious possibility, and waking up in a jail cell sucks, so check often, make sure you have both fast and long acting carbs, err on the side of caution (being high), and make sure your friends are looking out for you and know not to leave you to "sleep it off" if you pass out. Also, a medical ID can't hurt (though I found out that it won't necessarily help).