If you're installing the Monkworks Alternator there should be just enough room there. You can loosen the collar holding the Tacho Gen and turn the tail of it down into the vertical so its out of the way. This should then give you enough clearance to install the alternator.
If its not a Monkworks unit you're installing then yes, you will need to remove the Tacho Gen and come up with an alternative. Vans sell a cap to place over the tacho output on the engine to blank it off.
You can go to the remote mounted Tacho Gen (sold by UMA) or go for the Hall Effect sensor that installs in the magneto, depending on your preference and your gauge.