Yes, I have heard about using teflon tape for the sway bar bushings. I haven't tried that myself though. The upgrade sway bars I have on my car came with hard bushings which were described as "self lubricating". I never heard any noise from them.
I don't know how long would teflon tape last though. Would it be effective longer than just greasing the bushings? Anyway, at some point it will fail and it should be replaced.
Here's a video of the process with bushings:
Basically, thin layer of teflon tape on everything prior to greasing. In North America, there is pink teflon tape that is thicker which may be more durable.