Retrieval-Augmented Generation (RAG) systems, when deployed in production, incur operational costs that can escalate with scale and usage. Managing these expenses effectively is essential for the long-term viability and efficiency of these systems. This chapter provides practical strategies to analyze, control, and reduce the financial overhead associated with production RAG solutions.

You will learn to identify primary cost drivers, such as LLM API calls, vector database operations, and compute resource consumption. We will cover methods for selecting cost-effective models, minimizing LLM token usage through careful prompt design and context management, and optimizing data ingestion and storage. Furthermore, the chapter examines infrastructure choices, comparing serverless architectures with provisioned resources, and discusses techniques for implementing usage quotas, monitoring spending, and setting up alerts for cost anomalies. A practical exercise in cost modeling for a representative RAG application will help solidify these concepts.