It's bugged currently. It used to work until the S4 patch. Now it just doesn't show anything. Yes, it really sucks, because the space explosion is a "bread and butter" effect. Hopefully it will be fixed soon.
Yep - it just doesn't work. (And yes, sometimes it used to fire off at a bad time too - EG very far away; but as of two patches ago - explosions just don't go off.
Of course with the new bug that somehow slipped through (seems to happen A LOT with the Foundry <--- Just an honest observation) - where somethings borked in the Genesis system and it won't generate a map for previewing, or after pulishing (if you published after the 9/15 patch) - I'd say fixing explosion effects takes a backseat to fixing that one.
I DO believe the QA testers at Cryptic are working hard, and not allowing these things to slip through intentionally, but since it seems EVERY single patch breaks something in the Foundry; and you guys want the Foundry to ne a subscription incentive in the new F2P Matrix - I think the QA system and procedures used for testing the foundry need MAJOR revision. The procedures and system in place for Foiundry bug testing seem inadequate given the amount of bugs that make it on to Holodeck with each update.
I actually don't even care so much that bugs slip through if they were fixed in a short period of time. Something like explosions not working, I could easily see that being missed. But then having it broken for months is kind of lame. There are a lot of missions in the Foundry that use this effect. It's one of the most important effects dramatic effects for space maps, so not having it is disappointing.