I understand Amazon will charge per GB provisioned EBS storage. If I create AMI of my instance, does this mean my EBS volume will be duplicated, and hence incur additional cost?
You are only charged for the storage of the bits that make up your AMI, there are no charges for creating an AMI.
In this case, you will pay for the size of the storage used, instead of the storage provisioned. Snapshots will not store any empty blocks.