Odin is a small, low-cost satellite with a combined astronomical and aeronomical mission. The mission is divided on an equal basis between astronomy and aeronomy. The aeronomy objectives can be divided into four main subjects: stratospheric ozone chemistry, mesospheric ozone chemistry, the summer mesopause region, and the coupling between atmospheric regions. The primary instrument on Odin is the millimetre and sub-millimetre radiometer (SMR), which is used both for astronomy and aeronomy. It is the first satellite to use sub-millimetre frequencies for limb-sounding mode. Odin is also equipped with an optical spectrometer (OSIRIS). This paper is the third of a three-part series and describes the choices of observing modes and the expected performance of the SMR instrument for the aeronomy mission. The relevant frequencies are identified and the exact selection of lines is made. This is followed by a detailed simulation study to determine the achievable altitude coverage together with the corresponding vertical resolution for each retrievable species. An indication of the expected uncertainties is also given, showing, for example, a high-sensitivity to mesospheric water vapour and stratospheric chlorine monoxide. However, a complete analysis of observation uncertainties must await launch and the completion of the validation programme. PACS Nos.: 42.68A, 07.07D, 07.57K