Peat moss alternatives

Square Foot Gardening List - http://www.flinet.com/~gallus/sqft.html
Well, I've gone and done it.  DH and I went out this morning and bought 24 more cinderblocks so I can have another raised garden.   Instead of filling it with soil and finished compost, I'll be trying the "lasagna gardening" technique I mentioned a few months ago.  It's where you basically compost in place, let it sit over the winter, and the bed is ready for planting by spring. 
 
The "lasagna lady" says to put a layer of peat moss between each layer of other organic material, be it veggie scraps, leaves, or whatever.  I have bought some, but it's not going to go very far.  I'm not sure what it's purpose is in the mixture.  Can anyone suggest why finished compost wouldn't work just as well?  I have quite a lot of that, and it's free. 
 
Erica
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