  We study the effect of electronic Coulomb correlations on the vacancy
formation energy in paramagnetic alpha-Fe within ab initio dynamical mean-field
theory. The calculated value for the formation energy is substantially lower
than in standard density-functional calculations and in excellent agreement
with experiment. The reduction is caused by an enhancement of electronic
correlations at the nearest neighbors of the vacancy. This effect is explained
by subtle changes in the corresponding spectral function of the d-electrons.
The local lattice relaxations around the vacancy are substantially increased by
many-body effects.
