greenwire on fuel tank near sending unit

[RidgeRunner]

It needs to go to the negative post on the battery as Spare pointed out. But if you have another suitable ground, whatever it may be, you can get away with attaching it to that. The garbord style drain plug you described will not work for this purpose as it is not grounded to the battery. If your battery is in the back just hook it to the negative battery terminal. If you don't have a battery back there you could hook it to one of the four bolts that hold the engine to the transom. I don't like that because you will need a 1/2" eye terminal to go over the bolt and those bolts should be sealed with some sort of caulk/sealer to protect the transom from water intrusion which may prevent you from having a good ground to start with, but it is your call. You could run it to the engine and ground it to the block but the manufacturers just run it directly to the battery and then they are not relying on the guy rigging the engine to make this connection. It is considered part of the boat wiring and unrelated to the engine wiring.
USCG requires aluminum and steel tanks to be grounded and YES it could lead to tank failure from electrolysis.