Sponges have no light requirements at all, so this isnt an issue. Although this said, too much light can see algae grow over the sponge which inturn will kill it! So they do best low down and shaded.
Water movement is very important to them though as water must pass through there body structure so they can extract nutrients from it. Is the sponge in a low flow spot?
My blue sponge was quite pale in my last tank, but i thought nothing of it. I upgraded quite a while ago and now have a SPS dominated reef, so with this i have upped the flow considerably in my tank.
The sponge is doing brilliantly, very strong blue colour and fast growth (for a sponge anyways.). I couldnt tell you if it is in a high or low flow area of the tank, but i would suspect it towards the higher end, with low light as its in the entrance to a cave on the sand bed and has started encrusting around the mouth of the cave. the various other sponges i have also should very positive results from the upgrade in water flow of the tank.
Just for reference i now turn my entire tank volume over around 55x per hour.
Try giving yours more flow and see if it picks up after a few weeks.
And make sure it gets no algae growth over it.
HTH
Mark
