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From what I've seen Dust can buy production, but it's main use is limiting early expansion by cutting income to 50% of normal value on new colonies; there's, also a hefty fee for fleets, as I recall. So, it limits expansion and almost prevents early fleets. Low Dust means higher taxes which means lower Happiness, which is a no-no.
I hear there's lots of Dust in an established empire, but in the early stages, Dust directly relates to happiness and, therefore success.
You can also drop taxes to gain approval, use dust to recruit heroes and use hero dust abilities (superior battle-action cards for space combat), and use it in trades. 20,000 dust in late game can go away very fast for purchasing warships though, I usually prefer to use it for upgrading new colonies and conquered worlds with important structures.
- heroes require a salary per turn requesting more the higher their level
- buy-out option to rush every queue to 1 turn
- repairing fleets requires dust and sometimes population
- retrofitting fleets requires dust and sometimes population
- some hero abilities require dust to activate
- a high dust income per turn enables you to lower your tax rate = happy population = more bonuses to everything else
Dust is a control instrument really with different jobs depending on what stage your match is. At first its a limiter to things like expansion, fleet size and morale control. There will be a point (also some factions are better at dust generation then others) where your income per turn outmatches your maintanance needs so much that your treasury will bloat up. This is the time of the game where you can take decisive actions and focus on a course of events. Rushing critical improvements to get newly founded colonies up to date (something that would normally require dozens of turns), speed-manufacturing WHOLE fleets in a single turn to react to incursions, attacks or bolster your own assault ranks. Retrofitting your fleets in an instant to react to a new enemy ship design.
Basically...dust loses value the further you get into a match, same as happiness. Eventually you will unlock empire modifiers or system improvements which boost either stat so much that you can worry less and less about it and focus on other things instead (which is the main purpose).