Spray foam would do a good job but probably cant be considered ”green”. cellulose (paper) insulation is made from recycled paper products so that should fit the bill and if you can do a cavity fill that would be great.

There are many levels of being "environmentally friendly." Front-end manufacturing, life cycle, material, off-gassing, etc that you'd have to decide for yourself what fits your criteria.

But for a garage with habitable space above it, you are not only looking for insulation value, but ease of installation and acoustic abatement. In the latter senses mineral wool (or denim) would be better than cellulose.