Sometimes it just doesn't grow. You don't need the light on 24/7 by the way....that's just for caulerpa.
There was a power outage at a tank I used to maintain. It was out for 14 hours- long enough to kill most of the fish and all inverts. After the tank recovered, and was re-cycled, chaeto never grew again, no matter what light or flow. This tank produced massive amounts of chaeto before this.
The tank flourishes now, but I had to use razor caulerpa in the fuge.
I have no idea why this happens.
My tank is having trouble growing chaeto also. It's slowly breaking into pieces and disappearing.