Here is the part of the deobfuscated code from TFC's "WorldGenPeatPit.class" where peat only generates in swamps:
TFCBiome biome = (TFCBiome)par1World.a(var8, var9); if (biome != yr.h) continue;
The problem is yr.h is a vanilla swamp biome, here it is in yr class in minecraft.jar:
public static final yr h = new zj(6).b(522674).a("Swampland").a(9154376).b(-0.2F, 0.1F).a(0.8F, 0.9F);
And here is what the code should be instead:
TFCBiome biome = (TFCBiome)par1World.a(var8, var9); if (biome != TFCBiome.swampland) continue;
Here is TFCBiome.swampland:
public static final TFCBiome swampland = new BiomeGenSwampTFC(6).setColor(SwampColor).setBiomeName("Swamp").setMinMaxHeight(-0.1F, 0.1F);
So peat never generates because the code tells it to only generate in vanilla swamps, which don't exist in TFC world generation.