Making more room for the tanks means either less cabin/storage and/or bigger cross-section and increased drag.
"Long-distance" is a subjective term. There is an ever-increasing distance for which batteries are doable. Everything else is will be liquid biofuels, rather than efuels.
Biofuels are as green as the process making them. Electrify the equipment being used (something that's being done for reasons orthogonal to this) and you're already made the process more green.
Again, biofuels are not green. The process that makes them involve vast quantities of land and resources. It is in fact a very inefficient and resource intensive idea. It is actually much worse than what it takes to make e-fuels.
Aircraft will remain liquid-hydrocarbon-fueled for the foreseeable future, even if the fuel production transitions to a synthetic process vs. refined crude oil.