At the moment you can cast spells like "spark" for no mana cost but still have the damage over time effect. http://www.youtube.com/watch?v=vYmWJKmQ3I0
The video above shows it in effect, where the damage is applied but only ~1 mana is drained and the automatic mana regeneration regenerates that mana back faster than you can spend it.

I've been able to kill a giant at lvl 3 without losing any mana by using this....on Expert difficulty.

Fix: have the damage over time spells have an initial mana cost scaled to the damage done when the spell is triggered. Currently you can just trigger the spell for no mana cost, yet have a full second worth of damage.

found this too, really needs to be fixed

If anyone knows how to reach the devs, please do so. It kind of amazes me how something like this can get past beta. I found this out the second I used the "spark" spell, I wasn't even looking for bugs/exploits and it just stood out the second I used the spell that there was something wrong with the math/mechanic.