This is a theory on the origin of the Rainbow Friends. It takes place in an alternate timeline and is not canon, so read at your own discresion.
It all started on a usual weekend in Langhorne, Pennsylvania, sometime in 1991, 11 years after the park's opening. Sesame Place Theme and Waterpark was packed with visitors and little children looking to have fun, as was usual for an amusement park on aweekend. The show's cast- Cookie Monster, Big Bird, Elmo, Rosita, and other prominent Muppets- was all welcoming. It was another normal day for leisure at the theme park for both the cast and children.
However, none of the cast knew what was on Grover's mind. The scaredy Muppet was in the park's ventilation system, playing superhero and acting curious as any Muppet would that day. However, he came across a corridor that he had never come across before- a very long one with no other vents branching out from it, just ending at another vent with eerie chartreuse light glowing out of it. Grover crawled over, but little did he know that the sequence of events succeeding his choice would have dire consequences- not just on him, but the whole park...
Grover opened the vent. He was now within the park's sewage system, where he found several containers of bright, green liquid that all of the park's human waste had been mixed into. Each container was heated to help rid the liquids of their smell. Grover, amazed at this new discovery, prepared to turn back to tell the entire story to his friends, but was caught by the liquids distinct smell.
Grover decided to stay for a few more minutes- but that decision would prove fatal. He lost his core balance in the vents and fell into one of the liquids.
"AAAAAHHH!!!!!!!!! AAAAAAAAAAAAAAAAAHHHHHHH!!!!!!", Grover screamed as he was badly burned by the liquids. He tried climbing out, but the surface temperature of the container he was in was so hot, it burned his hands. He screamed, "HEEEEEEEEEEEEELLLLLLLPPP MEEEEEEEEEEEE!"", but no one was there to hear his cries of desperation. Grover resorted to one last measure- pushing aside the can from inside to get out easier, but he pushed it into the wrong direction, causing all of the other containers to topple. As liquid from one container touched the liquid of another, it produce an eerie, odorous gas. Grover breathed in the gas... and was never his normal himself again. His limbs grew, his claws grew sharp and fused with his fingers, and his lower jaw merged with his neck as his eyes dilated drastically in size. His badly burned skin's color was fermented into a pale, dark violet.
The horribly disfigured being that was once Grover then proceeded to climb back into the vent from whence he came, ready to cause chaos. With the gas that transformed him now following him, he punched open another nearby vent, where Cookie Monster, wearing a crown to celebrate a kid's birthday, was sitting on a throne entertaining them by baking cookies.
On the other side, just as Cookie Monster was tediously taking out his cookies from his miniature portable baking oven, the vent behind him opened, and he, along with all the other people in the room, quickly noticed as a violet, scrawny claw emerged from the vent. It hovered for a few seconds... and grabbed one of the kids and pulled him into the vent... never to be seen again.
Screaming erupted across the room shortly after, accompanied as the sound of flesh being eaten and the rattling and breaking of bones, and eventually the hissing of the green gas that started it all. Cookie Monster suddenly took his focus off of the cookies he was baking and assisted in helping everyone evacuate the room, but before he could shut the room's glass door in time to contain the smell, the violet claw grabbed him and a horribly disfigured and burned figure spontaneously emerged to wrestle with him.
"GROVER!!! WHAT'S GOTTEN INTO YOU!?!?", shouted the big blue Muppet, immediately recognizing its identity. But the violet figure continued its grapple, and the two violently engaged in a fight. Cookie Monster managed to briefly gain the upper hand, but just as he was about to perform a finishing suplex on the figure, it swung its right claw at his face... permanently blinding Cookie Monster's left eye. As Cookie Monster recoiled, the figure then lunged at Cookie Monster and violently bit him in his left shoulder, secreting glowing chartreuse saliva as his victim screamed in pain.
"NEEEEEEDDDD COOOOOOOOOOOKKKIIIIIIIIIEEEEEEEESSS!!!!", screamed Cookie Monster desperately, as cookies made him strong. But the room was almost filled with gas, making it hard to breathe properly. Cookie Monster used the last of his strength to use his good arm to grab a cookie and eat it in desperation, but by this time the figure's glowing saliva had entered his nervous system and bloodstream. This, alongside the ingestion of the green gas, caused his fur to fall off the rest of his body, and in the once fluffy Cookie Monster's place was another figure that could no longer tell human from cookie.
The gas, still uncontained, leaked into other areas of the park. Rosita, who was helping another tourist with directions around the park in Spanish, was suddenly thrown off by the gas, blinding her. She was then grabbed by the violet figure's long claw, who was now accompanied by the blue figure. As the poor Muppet tried to resist and escape, screaming in desperation, the two figures bit both of her arms off. It was then when she succumbed to the gas, which closed up the wounds where her arms once were. Her face and torso were also horribly disfigured from breathing in too much of the toxic gas.
Oscar had witnessed the situation from afar, and tried to hide in his trash can in hopes that his three former friends would not spot him. However, the gas slowly leaked into his trash can, causing Oscar to mutate with it alongside the trash he used as a mattress. He tried to put himself out of his own misery by ripping off the top of his head, but it was too late.
By this time, gas had already leaked into almost all of the park. Desperate guests tried to escape from the park as the gas killed any human and corrupted any Muppet that got caught in it. If a Muppet was found to not be strong or immune enough, they were also killed. Abby Cadabby, a rather small Muppet, somehow managed to survive, though this was because she was practicing a spell when she was engulfed in the gas. The spell backfired because of the gas, causing her to mutate and grow in size.
Big Bird helped save dozens of guests from the exit, carrying them with his bulky body and arms. However, before he could save himself, he suffered the same fate as the others- he was engulfed by the gas, with all of his feathers dropping onto the ground one by one, revealing an emaciated but paranoid figure who thought he could fly.
As soon as all the visitors were out of the park, a nearby technician prepared to close the gates. However, the severely mutated Muppets now advanced towards him, giving him little time to lock the gates. He decided to quickly lock the gates from the inside and quickly barricaded the area to prevent it from escaping, and then ran away, never to be seen again by the public...
The only Muppet who survived was Elmo, who could do nothing as he watched his friends, one by one, succumb to and transform from the gas and each other. It was that day that forced him to mature and shed his childlike, carefree personality. However, Elmo still believed that his friends were not completely gone and could bring them back. This caused him to become disillusioned with reality as he began his scientific pursuits.
Over time, Elmo grew in height, size, and intellect. He had used the room where it all started to start his experiments as soon as the gas dissipated. However, every experiment he had attempted failed miserably, as it killed some of the figures experimented on, and since Elmo was not strong enough at the time, he had to stealthily perform his experiments from a distance or stealthily, but the figures that survived his experiments only grew enraged and chased Elmo down. Elmo was lucky enough to survive all of those instances, and after several years of failures, he came to a conclusion.
By observing that day that his former friends preyed on humans, he believed that human flesh would help them gain their sanity again and restore them to normal. In doing so, he forever ditched his former name, finding it to be too childish for anyone to take him seriously, calling himself "Red" from thereon. Using his newfound technical knowledge, he lured several passer-bys into coming to the closed park. From there, many victims would fall to his experiments, with only a few escaping...
In other words, here is m theory of which Rainbow Friends originated from which Sesame Street Muppets:
Elmo- Red/Scientist (did not mutate; instead matured)
??? (Ernie or Mr. Snufflepagus)- Orange
Big Bird- Yellow
Oscar the Grouch- Green
Rosita- Cyan
Cookie Monster- Blue
Grover- Violet
Abby Cadabby- Pink