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It may not be as much as the colossal $300 million financing that Nanosolar finally disclosed yesterday — the biggest ever for a solar company — but another thin-film manufacturer, AVA Solar, has broken into the nine-figure funding range today, with a challenge to industry giant First Solar’s dominance.

AVA stands out a bit from its peers, for several reasons. For one, it’s based in Fort Collins, Colorado, well away from the sunny or technology-laden areas its competitors operate in. The outfit has thus gotten relatively little attention. The second oddity is the technology that AVA uses, which builds thin-film cells using cadmium telluride (CdTe), a kind of semiconductor.

Most of the biggest bets in thin-film solar, a form of solar panel that is less efficient than traditional silicon-based cells but much cheaper to make, are based on copper-indium-gallium-selenide, or CIGS technology. Ascent Solar, Heliovolt, Miasole, Nanosolar, and a bunch of other companies all use CIGS. There’s an ongoing debate as to whether CIGS, CdTe or a third material, thin-film silicon, is best.

However, CdTe, despite a reputation for being difficult to work with, holds a singular distinction: It’s what First Solar, the industry’s first and only success, First Solar, uses. It has been reported that First Solar has no direct competitors in CdTe technology. AVA obviously proves that claim wrong. A handful of others working with CdTe include Sunovia (OTCBB: SUNV), Calyxo, which is owned by the German giant Q-Cells, and PrimeStar Solar, which recently sold a majority stake to General Electric Energy. Primestar, like AVA, is based in Colorado.

AVA is currently building a plant in Fort Collins, CO, where it promises to employ 500 at a production line that will make 250 megawatts worth of cells a year by 2010. The company appears to use deposition on glass to make its cells, which is also what First Solar uses, although a company spokesman tells me that AVA’s technique is “completely different”.

A number of well-known venture firms came on for the $104 million funding. DCM led, while new investors Technology Partners, GLG Partners and Bohemian Companies participated, and previous investor Invus came back in. AVA raised its seed less than two years ago and took a second funding in June of 2007, but didn’t disclose amounts for either of those fundings.

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